Cattle futures higher watching direct business develop

At the Chicago Mercantile Exchange, live and feeder cattle were up, watching direct trade develop at sharply higher prices. February live cattle closed $2.42 higher at $230.95 and April live cattle closed $2.30 higher at $230.67. January feeder cattle closed $5.02 higher at $343.40 and March feeder cattle closed $4.85 higher at $337.67.

There was a solid round of direct cash cattle trade that developed Thursday. Live deals in the South were marked at $230, $6 higher than the previous week’s weighted averages. Dressed deals in the North were marked at $355, $12 higher than the prior week’s weighted average basis in Nebraska. The bulk of the week’s business has likely wrapped up, but some cleanup trade is likely before the end of the day Friday.

At the Huss Livestock Market in Nebraska, steers were steady to $10 higher. Heifers 500 to 800 pounds were steady to $10 higher. The USDA says demand was moderate to good from the buyers in-house and online. Receipts were up on the week, but down on the year. Feeder supply included 62 percent steers with 71 percent of the offering weighing more than 600 pounds. Medium and Large 1 feeder steers 701 to 749 pounds brought $360 to $389 and feeder steers 753 to 797 pounds brought $349 to $389. Medium and Large 1 feeder heifers 650 to 694 pounds brought $348 to $367.50 and feeder heifers 700 to 740 pounds brought $341.50 to $354.

Boxed beef was lower with light demand for heavy offerings. Choice was $1.25 lower at $358.11 and Select was $1.42 lower at $343.46. The Choice/Select spread was $14.65. Estimated cattle slaughter was 123,00 head, up 2,000 on the week and down more than 2,000 on the year.

Lean hog futures were mostly higher on spread trade, with the recent strength in pork values. February lean hogs closed $1.75 higher at $84.17 and April lean hogs closed $1.85 higher at $89.22.

Cash hogs closed higher with a fairly moderate negotiated run. Processors were much more aggressive in their procurement efforts and had to bid up to move desired numbers. Pork remains a competitively priced protein in the retail space, and that is likely providing support to the domestic market. But global demand is the big unknown right now.