Thomas Elwood: Early livestock comments
Feedlots are asking $113.00-$114.00 for cattle left on the lists. There are no bids again today, and trade may be over for the week. All eyes will be on Japan and the futures market for direction on next week's pricing. There is a Cattle on Feed Report this afternoon, which could add some bearishness to the market if placements are larger than expected during February. On the other hand, if placements are smaller again during the month, the board would receive another boost.
The choice cutout was up $0.16 at $187.79 last night, with the select up $0.06 at $186.67. Spot trade volume was extremely light again, and the industry likely will no move even 800 loads of cuts for the week. Packer margins are huge again, so they have room to play with prices, but they seem to be trying to reduce production instead. Slaughter is still down by 22,000 head from last week. Middle meats remain strong, but chucks were easier despite the smaller production this week.
Early hog calls are mostly steady. Packers are done buying for this week, but still need hogs for the end of next week. Slaughter is expected to be smaller on Saturday next week, so ideas are that packers will be able to get what they need without chasing the market.
The pork cutout gained $0.30 last night. Loins were quoted steady/weak. Butts were 2 cents lower. Heavy hams gained another penny. Bellies were unquoted. The fact that Japanese pork buyers reportedly were in the market on a normal basis this week seemed to bring some sense of relief to the industry, though some remain worried that there still could be a hiccup in shipments at some point due to problems with electricity and refrigeration in Japan.
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TJE Cash trade information provided by Robin Fuller