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DTN Early Word Livestock Comments 04/16 06:41

16 Apr 2021
DTN Early Word Livestock Comments 04/16 06:41 Selling Pressure May Be Short-lived Livestock futures closed lower Thursday with hogs taking the brunt of the pressure. Cattle continue to be under pressure due to rising feed prices. Hogs had a round of "Katie-bar-the-door" selling Thursday as traders could not liquidate fast enough, leaving futures locked limit down. Follow-through is likely as the remaining pool of trades are liquidated on the open. Robin Schmahl DTN Contributing Analyst Cattle: Higher Futures: Mixed Live Equiv: $204.37 +2.07* Hogs: Lower Futures: Lower Lean Equiv: $119.91 +3.28** * based on formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. Index has been updated to depict recent changes in live cattle weights and grading percentages.) ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: It was an ugly day in the livestock complex. Cattle futures continued to decline even though cash traded higher and boxed beef showed strong prices. The focus was on continued futures weakness as liquidation is still not finished. High grain prices, cash not increasing as much as most had anticipated, and somewhat dismal export sales kept pressure on futures. The bright spot was that cash did trade higher and boxed beef was significantly higher. However, that paled in comparison to the negatives. Fund liquidation has defied the usual three-day decline, especially in the face of increasing cash prices. However, exports have been struggling the past few weeks, indicating that beef prices have become too high for the international appetite. Export sales totaled 15,700 metric tons, down 14% from the previous week and down 23% from the four-week average. Not good. U.S. consumers have not backed away due to stimulus money and other benefits, which is keeping boxed beef prices strong. Increasing grain prices and plummeting futures triggered cash sales Thursday $0.50 to $1.00 higher. This was good, but disappointing to the trade. It may be difficult to see higher futures Friday, but some stability could be seen.