DTN Midday Livestock Comments 05/29 12:12

DTN Midday Livestock Comments 05/29 12:12 Livestock Contracts Head Lower into Friday's Noon Hour The early part of the week blessed the market as contracts jumped higher and cash cattle traded steady, but come the latter part of the week contracts have back-peddled. ShayLe Stewart DTN Livestock Analyst General Comments As most people jump with joy and sip their coffee thinking, "Thank God it's Friday," the livestock contracts have merely done the opposite. As tensions rise between China and Hong Kong and some packing plants are seeing a second round of COVID-19 breakout, the board has seemed to throw in the towel and is giving back some of the ground gained earlier in the week. July corn is down 3 3/4 cents per bushel and July soybean meal is down $1.80. The Dow Jones Industrial Average is down 264.52 points and NASDAQ is down 14.30 points. LIVE CATTLE Live cattle contracts aren't taking Friday's pressure with ease as contracts dip $1.00 to $2.80 lower. June live cattle are down $2.32 at $99.15, August live cattle are down $2.75 at $98.45 and October live cattle are down $2.42 at $100.35. The market continues to be engulfed with uncertainty as contracts fall and the live cattle basis grows, nearby contracts dip below $100 but yet slaughter continues to press onwards and forward, and cash cattle prices are elevated to $120? Fundamentals are key to a healthy marketplace, and it's evident that through this time fundamentals have been thrown to the wayside. Some light cash cattle trade has popped up from a major in Nebraska who bought dressed cattle for $190. Boxed beef prices are lower: choice down $3.99 ($365.57) and select down $0.63 ($343.46) with a movement of 64 loads (26.48 loads of choice, 13.95 loads of select, 14.71 loads of trim and 9.11 loads of ground beef). FEEDER CATTLE Feeder cattle contracts are trying to ride the wave that Friday has been floating on without closing limit lower, but as the day processes contracts are falling more and more. August feeders are down $2.30 at $133.20, September feeders are down $2.20 at $134.05 and October feeders are down $2.20 at $134.57. Sale barns have had phenomenal sales in the last couple of weeks despite the board's indecisiveness. Heading into the heart of early summer calf specialty sales, the feeder cattle market needs live cattle prices to hold strong and for the board to rally. LEAN HOGS The lean hog complex is trading somewhat lower but given the news circulating throughout the day, the board is maintaining quite well. June lean hogs are down $0.62 at $56.30, July lean hogs are down $0.77 at $54.87 and August lean hogs are down $0.57 at $54.45. Late Thursday afternoon Tyson announced that they would be closing their Storm Lake plant in Iowa for the rest of the week due to COVID-19. When at full capacity the plant processed 17,250 a day. After performing a deep-clean this week the plant is scheduled to resume business next week. Hopefully this isn't a trend that's about to take off again -- fingers crossed. The projected lean hog index for 5/28/2020 is down $1.70 at $61.25 and the actual index for 5/27/2020 is up $0.42 at $62.95. Hog prices are lower on the National Direct Morning Hog Report, down $0.61 with a weighted average of $36.73, ranging from $29.00 to $38.25 on 4,931 head sold and a five-day rolling average of $36.31. Pork cutouts total 396.22 loads with 364.26 loads of pork cuts and 31.97 loads of trim. Pork cutout values: up $1.37, $90.83. ShayLe Stewart can be reached shayle.stewart@dtn.com (c) Copyright 2020 DTN, LLC. All rights reserved.