Weakness in U.S. stock futures early Friday morning suggests Wall Street remains cautious as it weighs comments from a regional Federal Reserve president about the health of the economy and a mix of quarterly profit reports.

Cash fed cattle. USDA reported light to moderate trading on light to moderate demand in all major feeding cattle regions Thursday. Compared to last week, Texas/Oklahoma/New Mexico and Kansas live sales traded $2 lower at $93. Dressed sales in Kansas were $3 lower at $148. 

Compared to Wednesday in Nebraska, dressed sales were mostly steady at $148, while live sales were also steady at $93. 

Compared to last week in Colorado, live sales traded mostly $2.50 lower at $93, while light trading of dressed sales were $4 lower at $147.

Trade chatter hints at lackluster buying interest. Cattle purchased this week will go to slaughter next week, a time when packers can access August contract cattle. Other chatter suggests packers may be planning to trim a few hours of production next week to control meat inventories.

Urner Barry's Yellow Sheet at midday said demand for ground beef has diminished, and spot-market discounts were seen. Ribs and peeled tenders remained under pressure, and price reductions are noted.

Thursday’s afternoon boxed beef cutout values were lower on mostly light demand with light to moderate offerings. Choice cutouts closed down $1.31 at $153.39. Selects sagged 60 cents to $145.74. Load count totaled 60.

USDA estimated Wednesday’s slaughter at 129,000. The 513,000 cattle slaughtered so far this week are 3,000 behind last week, but 9,000 ahead of a year ago.

Fed cattle futures. CME live cattle closed lower following weaker-than-expected early cash cattle price returns and lower midday wholesale beef values.

Wall Street’s retreat from morning highs set bullish cattle players on their heels.
Livestock traders use equities to gauge consumer demand for pricier products such as expensive beef cuts.

August and October also touched off sell orders after both months fell below Wednesday's lows.

Spot August ended 92 cents lower at $91.85. Most-actively traded October finished down 72 cents at $93.47 cents.

Cash hogs. Predictions for today’s Midwest cash hogs are mostly steady.

Yesterday’s regional cash hog price action was roughly the reverse of Wednesday. Wednesday the west surged, while eastern hogs barely budged. Yesterday eastern hogs rocketed higher, while the west gave back much of Wednesday’s gains.

Loss-induced herd reductions of the last two years combined with seasonally decline supplies are challenging packers to get hogs. Tight supplies give producers bargaining leverage, especially operations large enough to be able to offer multi-load packages.

Sizable regional variability will likely persist as processors continue to seek additional hogs from limited offerings mainly for next week's delivery.

USDA’s afternoon report showed Thursday’s:
* Iowa-Minnesota hogs fell $2.61 to $81.57.
* Western Corn Belt hogs fell $1.98 to average $81.51.
* Eastern Corn Belt hogs gained $3.73 to average $84.80.
Price changes are compared to the prior day report for Wednesday.

Thursday’s pork cutout gained a modest 3 cents to $89.38. Load count totaled 50.

USDA estimated Thursday’s slaughter at 401,000. The 1.565 million hogs slaughtered so far this week are down modestly from last week’s 1.571 million, but well below last year’s 1.666 million.

Some processors are trying to balance their slaughter schedules to the tighter supplies by trimming an hour or so per shift daily or closing certain plants one day a week. Three plants will be closed today, two in the Midwest and one in Virginia. Today’s slaughter will be off about 30,000 head. Monday will be down about 40,000 to 45,000.

Dow Jones estimated Thursday’s packer margin at $10.74 per head, compared to $6.50 for Wednesday.

Thursday’s terminal hogs sold mostly steady to $1.50 higher. Live tops ran $53 to $58.

Hog futures. CME hogs settled higher and several months posted new contract highs, on generally bullish market fundamentals.

Spot August reached its highest point in 5 1/2 weeks on spreading into that month out of October and December. Spreading into October out of December and February resulted in a fresh contract high for October.

The lower dollar, which tends to improve overall U.S. exports, generated enough hog buying interest to drive December through April 2011 contracts to new seasonal tops.

Spot August closed $1.47 higher at $84.85. Most-actively traded October finished up $1.12 at $78.07.