Wednesday Closing Livestock Market Summary - Livestock futures Stabilize Late Wednesday

GENERAL COMMENTS

Cash cattle trade developed Wednesday in all areas with live Southern trade being light to moderate through the day, with prices pegged at $119 per cwt. This is fully steady with the light trade seen late Tuesday, but $3 to $4 per cwt lower than last week's price levels. Northern trade was extremely light, but developed at $188 to $190 per cwt. A $2 to $4 per cwt reduction from last week's levels. Additional trade is expected to be seen later in the week, especially in the North. But the tone of the market and price levels may have been set by the business done over the last couple of days. The Fed Cattle Exchange Auction report on Wednesday listed a total of 969 head, with 617 actually sold, 285 head listed as unsold, and 67 head listed as PO (Passed Offer). The state by state breakdown looks like this: KS 237 total head, with 237 head sold at $119.00-$119.25, 0 head unsold, 0 head listed as PO; NE 543 total head, with 258 head sold at $119.25, 285 head unsold, and 0 head listed as PO; TX 189 total head, with 122 head sold at $119.25, 0 head unsold, and 67 head listed as PO ($118.00); CO - no cattle reported; IA - no cattle reported; other states - no cattle reported. The delivery date/weighted averages breakdown is as listed: 1-9 day delivery: 549 head total, 359 head sold, with a weighted average price of $119.21; 1-17 day delivery 420 head total, 258 head sold, with a weighted average price of $119.25; 10-17 day delivery - no cattle reported; 17-30 day delivery - no cattle reported. According to the closing report, the national hog base is $0.55 lower compared with the Prior Day settlement ($53.00-$58.75) weighted average $58.09. The corn futures moved higher in light activity. December futures were 3/4 cent higher Tuesday. The Dow Jones Index is 107 points lower with the Nasdaq down 18 points.

LIVE CATTLE

Following early pressure Wednesday, morning live cattle futures closed mostly higher ($0.10 Lower to $0.70 Higher). The strong pressure seen Tuesday has allowed some short covering to develop. This brought about renewed buyer support late in the trading session, although live cattle futures remained under pressure through the first half of the trading day. At this point nearby futures have moved above $120 per cwt once again with traders looking for increased market support and the potential to draw increased trade volume through the complex over the coming days, although there seems to be an underlying weakness still hovering over the market given the pressure, which has developed through the month of November. Beef cut-outs: lower, $2.88 lower (select, $190.61) and down $0.54 (choice, $210.13) with light demand and offerings (71 loads of choice cuts, 50 loads of select cuts, 8 loads of trimmings, 9 loads of coarse grinds).

THURSDAY'S CASH CATTLE CALL:

Steady to Wednesday's Trade. The tone of the cash cattle market is expected to have been set due to the trade that trickled into the market Tuesday and Wednesday. This will likely draw some additional cattle moving through the end of the week, although bids and asking prices are expected to remain stable Thursday morning with where markets left off midweek.

FEEDER CATTLE:

Light to moderate market support developed late in the day Wednesday in most contracts ($0.50 Lower to $0.52 Higher). Buyer support stepped into all but October 2018 contracts through the last half of the trading session following a sluggish and weak start to the market session. This support in feeder cattle futures quickly followed the buying activity, which developed in live cattle futures as additional cash market activity started to develop. Even though cash prices have fallen from last week's levels, the focus on early week movement in cash markets helped to regain a little confidence by some traders who moved back into the market. CME cash feeder index for 11/14 is $159.27 up $0.20.

LEAN HOGS:

Lean hog futures closed mixed in a wide range ($1.05 Lower to $1.15 Higher) following the support that developed late day in cattle markets and spot month traders trying to square positions. Strong gains developed in front month December contracts late in the session, although the remainder of the market continues to focus on market uncertainty and add to the market pressure developing over the last couple of weeks. December futures quickly moved above $60 per cwt, closing at $61.12 per cwt, while the most significant pressure developed in summer 2018 contract months with traders still unable to focus on the ability to draw buyers back to the complex following the recent market slide. Carcass values tumbled lower following aggressive pressure in Hams and Butts. Pork cut-out: $80.63 down $1.18. CME cash lean index for 11/13 $66.68, down $0.32. DTN Projected lean index for 11/14 $66.37 down $0.31.

THURSDAY'S CASH HOG CALL:

Steady to $1 Lower. Very little additional direction is expected to be seen Thursday with packers once again starting out bids steady to $1 per cwt lower. Given the recent pressure in the market most bids are likely to be 50 cents to $1 per cwt lower as the focus on the upcoming holidays will likely limit aggressive packer spending with the available market ready hogs already in place. Thursday's slaughter is expected at 465,000 head with an expected Saturday run at 154,000 head.