Ag markets are mostly higher early Monday, except soybeans.
Brad Kooima, Kooima Kooima Varilek, says live and feeder cattle futures area rallying chasing record cash.
Prices in the North were $234 to mostly $235 live last week, with some trades late Friday up to $237 in Western Nebraska. Many of those prices could be locked in through the end of June. Northern dressed sales had a range of $360 to $376, mostly $370, $8 higher than the previous week’s weighted average, basis Nebraska.
The South traded $221 to mostly $223, up $2 to $3, but up to $225 late Friday.
Kooima says the basis is historically wide with cash nearly $25 over futures in some of the deferred contract months is making it difficult for producers to use the board for risk management.
Boxed beef values for the Choice cutouts are above $366 and the second highest levels since COVID, indicating continued strong demand.
Today is the first day of expanded limits in cattle futures with live cattle going from $6.50 to $7.25 and feeder cattle limits expanding from $8.25 to $9.25.
Kooima says this is not beneficial for cattle producers or hedgers.
“When is the last time cattle futures have been limit up? It’s been forever, yet we were just limit down the day the reciprocal tariffs were announced so I don’t see this as positive,” he explains.
Lean hog futures are higher except June getting pushed by strong cash and cutouts and fund buying.
Cutout values on Friday were up $2.60 at $107.22, a new high for the year and the Lean Hog Index was up $.71 coming into Monday’s session at $94.84.
Meanwhile, funds have piled in to buy the lean hog futures with their long position now at nearly 95,000 contracts and open interest rose nearly 65,000 contracts during May.
So, Kooima says there may be more upside and he’s targeting $112 on the June contract.
Corn followed wheat higher early in the session and saw some short covering but then fell with soybeans.
While soybeans fall with China trade concerns and favorable weather.
