Cattle pick up support while hogs break lower

June 26, 2021 00:00:00

The feeder cattle sector once again closed higher on Thursday amid a mostly lower trending US corn market, while the live cattle complex barely closed higher, seeming to just absorb some of the momentum from the feeder cattle market, report agencies.

Hog prices closed lower on the National Direct Afternoon Hog Report, down $6.60 with a weighted average of $116.18 on 6,746 head.

July corn is down 11 cents per bushel and July soybean meal is down $8.40. The Dow Jones Industrial Average is up 322.65 points and NASDAQ is up 97.98 points.

Feeder cattle futures were the only livestock contracts really taking full advantage of Thursday's support as both live cattle and lean hog contracts have contradicting signals to manage.

Live cattle futures were caught between a rock and hard spot as the market likes the idea of trading higher but did not feel like the nearby contracts can do so considering the undeveloped cash cattle market.

The hype surrounding the feeder cattle rally given the lower trending corn market has allowed for some of the deferred live cattle contracts to rally, but nearby contracts were skeptical.

August live cattle are down $0.35 at $122.52, October live cattle are steady at $128.17 and December live cattle are up $0.17 at $131.67. If the technical side of the market can trade fully higher, it may add enough pressure to the cash cattle market to persuade packers into paying at least $1.00 higher if not more.

There are a few scattered bids on the table that far but largely the market was still oddly quiet. There's been a few cattle trade in Nebraska at $126 on Thursday but otherwise the market's yet to see any substantial trade develop.

Beef net export sales of 16,900 metric tonnes (MT) reported for 2021 were up 31% from the previous week, but down 3% from the prior four-week average. The three largest buyers were South Korea (6,700 MT), Japan (4,000 MT) and China (1,600 MT).

Boxed beef prices were mixed: Choice down $4.19 ($307.86) and select up $1.00 ($276.41) with a movement of 70 loads (40.21 loads of choice, 13.35 loads of select, 10.29 loads of trim and 6.57 loads of ground beef).