Live and feeder cattle futures are higher to start Monday with hogs lower. Soybeans are extending gains, but corn is lower.
Cattle Recovering But is the Low In?
Live and feeder cattle futures are higher early Monday still trying to recover after the recent $60 correction in feeder cattle futures and $25 correction in live cattle futures.
Brad Kooima of Kooima Kooima Varilek says while the futures are distancing themselves from last week’s lows he isn’t sure if all of the bearish news is factored into the market yet.
The fear of the border reopening to Mexican feeder cattle imports is still in question and Kooima says USDA Secretary Brooke Rollins is in Mexico today meeting with her counterparts to discuss the New World Screwworm eradication and prevention efforts.
He says the additional 50% tariffs on Brazilian imports look like they will be suspended as both countries leaders have indicated as much, but there is nothing official on it yet. Those news items continue to loom large in the market according to Kooima.
What Do the Charts Say?
Long term uptrend lines are still intact in the live and feeder cattle futures but both posted lower weekly and monthly closes. Plus, there is a bearish flag formation on the December live cattle and January feeder cattle charts.
So, Kooima says that is also a concern for the fund traders and could cause more liquidation with a technical breakout.
Cash Could be Higher This Week?
Very little negotiated fed cash trade took place in the North last week according to Kooima. There were some sales early in the week at lower money in what looked like panic selling at $228 to $230 live and mostly $360 dressed. However, in the South the market tarted at $235 later in the week and by Saturday Kooima says there was some $237 traded in Texas. So, the trend continued to improve as the week progressed. As a result, Kooima is calling the fed cash market steady to possibly higher this week.
Meanwhile, the cash feeder market has softened in the country and the cash index is expected to be $3.50 lower today a $343.70.
Hogs Fail Despite Lower China Tariffs
Lean hog futures continued to see pressure early Monday and were barely holding support in the December contract at $80.00 despite the futures discount to the cash index at $91.19. However, cash has continued to fall and weigh on the futures.
The White House released details of the China trade framework over the weekend which included China lowering retaliatory tariffs established on March 4 which would be positive for pork exports. However, even that failed to move the market higher and Kooima says it may be because China is unlikely to buy pork with the glut of supplies in their own country.
Soybeans Make Fresh Highs
Meanwhile, soybeans are making new highs for the move as the White House clarified the lower Chinese tariffs on U.S. soybeans and that the 12 MMT China has agreed to buy is for the last two months of 2025, which is bullish.
Corn Fails
Corn failed to follow the strength in the soybean market as the last of the U.S. harvest is coming to market and looking for storage so there is some hedge pressure. Plus, Kooima says the corn market is running into stiff chart resistance in the December contract.
