Thomas Elwood: Early livestock comments
Cattle traded lightly in Texas and Kansas yesterday at $100.00 live, down at least $1.00 and as much as $2.50 from last week's trade. Western Nebraska saw light trade at $100.50 dressed, but not enough dressed trade in the East to call a market. More trade is possible today, especially in Nebraska, though one can never rule out an overnight trade up there.
The choice cutout was up $0.81 at $161.37 last night, with the select up $0.33 at $154.55. Volume was extremely light; the least since the record low back in September. Buyers likely will try to pressure prices going forward since packers have bought cattle cheaper this week. Their success depends on how willing they are to switch to cheaper pork and chicken features, as well as the level of export demand.
Cash hog bids are expected to be steady at best, with a lot of bids $1.00 lower again. Hogs remain easily available and weights are extremely heavy. Given the continued sharp decline in pork values this week, packers are still under the gun to protect margins.
The pork cutout lost $1.91 last night. Loins were quoted "weak", with boneless product dropping to a new low for the move. Butts were mostly a penny lower. Heavier hams also lost ground and contributed heavily to the drop in the cutout. Though light hams sold several cents higher, it was just one load and we note a severe shortage of the lighter product due to heavy slaughter weights. Bellies dropped below 90 cents on the weighted average, down 2 cents from the previous quote.