The cash feedlot trade essentially remained a nonevent Wednesday. We saw a few more bids tossed in the ring (i.e., $106 live; $168 to $170 dressed), but very little attractive enough to spark meaningful business. Asking prices were around $111 to $112 live and $175 dressed. According to the closing report, the national hog base is $.23 lower compared with the Prior Day settlement ($33.00 to $37.00, weighted average $36.82). The corn market settled fractionally higher, modestly supported by light short covering and strength in the wheat trade. The stock market closed higher with the Dow up by 61 points and the Nasdaq positive by 79 points.
As expiration nears, spot August attracted enough buyers to push the settlement back over 109 (i.e., up 137 points). This seems to be an impressive sign regard solid late week cash expectations. The rest of complex settled narrowly mixed, up 27 to off 47. News of a Florida cow found with atypical BSE (and successfully kept out of the food channel) did not have any impact on either cash or CME trading. Beef cut-outs: mixed, up $.28 (choice: $212.68) to off $.73 (choice: $203.55) with light to moderate demand and offerings (73 loads of choice cuts, 22 loads of select cuts, zero loads of trimmings, 21 loads of ground beef).
THURSDAY'S CASH CATTLE CALL:
Steady. If traders are planning on a long weekend, they will need to agree on price levels sometime Thursday in order to generate at least moderate volume.
Lackluster action was seen through the session with neither side showing great deal of determination. The late summer trading range remains relatively narrow and quite predictable. When everything was said and done, feeder futures settled 2 to 97 points lower with 2019 issues losing ground on 2018 contracts. CME feeder index 08/28: $150.23, off $.37.
Trading in lean hog futures was about as directionless as you can get. Indeed, the limited and inconsistent prices movement may have been even more boring than the business seen throughout the cattle complex. Price changes at the final settlement were narrowly mixed, up 37 to off 50. The carcass value closed modestly lower with defensive demand for fresh cuts overshadowing belly and rib strength. Pork cut-out: $64.68, off $.22. Cash lean index: 08/27: $47.09, off $.70 (DTN Projected lean index for 08/28: $46.45, off $.64).
THURSDAY'S CASH HOG CALL:
Steady. Look for hog buyers to resume procurement activity on Thursday with steady bids.
John A. Harrington can be reached at email@example.com
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