Written Commentary
by Chris Lehner, Senior Livestock Analyst
CATTLE
Before long, traders and the futures market will have to price and put a value upon the cattle and hogs that have backed up and owned by producers that sell on the showlist and daily markets versus contracted livestock and livestock outright owned by packers.
Some feedlot owners being told possibly a month to a month and a half away and no set dates or prices before cattle can get to slaughter plants.
The fair pricing rules of the Packard and Stockyard Act have been discarded.
As of May 19th Dressed weights were 874.6 compared to previous week at 872.55. Compared to a year ago weights are up 40 pounds. Grade percent was 84.1% compared to previous week at 83.0%.
FEEDER CATTLE
Compared to last week, steers and heifers sold steady to 4.00 higher. Demand was moderate to good this week with the larger Auctions in the Southern Plains having many offerings weighing over 800 lbs coming off rye or wheat. Those calves and lighter yearlings that are suitable for grass were met with good to very good demand. Seller interest has improved as feeder prices slowly start to rise and more buyers are coming out to the auction. Auction receipts were heavy again in the wheat and rye grazing areas in the Southern Plains with the two OKC area auctions had over 24,000 on hand while Winter Livestock in Pratt, KS had over 6,000 on offer.
LEAN HOGS
Compared to a week ago slaughter is up 1.5%
Compared to the same week a year ago slaughter is down 7.8%
CME CASH HOG INDEX 05/20/2020 at 64.59 down 1.39 from previous day.
CME CASH PORK CUTOUT INDEX 05/21/2020 at 102.63 DOWN 2.85 from previous day. (DOWN $13.97 IN 5 DAYS)
CME CASH FRESH BACON INDEX ON 05/15/2020 WAS 229.19 COMPARED TO 05/08/2020 WAS 212.41
Big movement of pork Friday. Loins up 8.06 kept cutout from dropping too hard with Butts, Picnics, hams and bellies all lower. Loins only cut higher on the week
Looks like high priced pork chased exporters away. It is possible China may have finished buying for storage. Record export buying from China last year from the EU and Brazil and this year adding in big exports the first quarter from the Us along with increasing market hog inventories in China have push pork supplies high enough that the price of pork in China is going down.
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