Walsh Trading Daily Insights
Commentary
Livestock markets opened weak on Monday as rising Wuhan virus cases sent shivers through the markets as traders feared demand would once again collapse. Markets were able to recover and settled in positive territory. July Lean hogs settled at 52.275. Support for July Lean Hogs on Tuesday is at 51.80, 50.475 and then 49.35. Resistance is at 53.825, 54.775 and then 55.625. The Pork Cutout Index and the Lean Hog Index continued their decline. The Pork Cutout Index declined and is at 69.66 as of June 12, 2020. The Lean Hog Index fell and is at 48.97 as of June 11, 2020. Estimated Slaughter for Monday is at 457,000, this is above last week’s slaughter of 445,000 and below last year’s slaughter at 474,000. August Feeder Cattle settled at 131.175. Tuesday has support at 131.10, 129.65, 128.875 and then 127.575. Resistance is at 132.075, 133.50, 134.25 and then 135.60. The Feeder Cattle Index fell and is at 128.51 as of 6/12/2020. August Live Cattle settled at 96.00. Support is at 94.30, 92.15 and then 91.05. Resistance is at 96.10, 97.075 and then 99.375. Boxed beef cutouts continued its descent from record levels and are nearing last year’s levels. Choice cutouts decreased 2.03 to 228.61 and select declined 4.92 to 214.35. The choice/ select spread widened to 14.26 and the load count was 166. Monday’s estimated slaughter is 119,000, above last week’s 117,000, and just below last year’s 120,000. The USDA report LM_Ct131 states: Thus far for Monday negotiated trade was slow on light to moderate demand in all feeding regions. In the Texas Panhandle a few live purchases were reported at 100.00. In Kansas a few early live purchases traded from 98.00-100.00. In Nebraska a few early purchases were reported from 100.00- 105.00 with dressed purchases from 159.00-167.00. In the Western Cornbelt a few early dressed purchases were reported at 167.00. However, not enough purchases in any feeding region for an adequate market test. The latest established market in any region was last week with live purchases in the Southern Plains mostly from 104.00-108.00. Last week in Nebraska, live purchases traded mostly from 102.00-108.00 with dressed purchases from 165.00-172.00. Last week in the Western Cornbelt, live purchases traded mostly from 103.00-105.00 with dressed purchases from 160.00- 172.00. So far, the Monday range for cash live cattle – 98.00 – 105.00 and dressed traded from 159.00 to 167.00.
Trade Suggestion(s)
Risk/Reward
Futures N/A
Options N/A
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Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
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