GENERAL COMMENTS:
Cash cattle trade is generally undeveloped with just a few token bids slipping into northern areas of $172 to $174 per hundredweight (cwt) in both Nebraska and Iowa. Asking prices are yet to be developed, as well as bids in southern cattle country. It is likely to be Wednesday or later when active bids and asking prices are seen and later in the week when actual trade develops. According to the closing report, the national hog base is $1.90 higher compared with the Prior Day settlement ($54-$64.50, weighted average $62.50). Corn futures were higher in light activity with the September futures contract closing 3 cents higher. The Dow Jones Index is 58 points lower with Nasdaq up 14 points.
LIVE CATTLE
Limited market movement with minimal direction characterized the cattle complex Tuesday. Futures closed $0.05 to $0.25 higher. Following the moderate price pullback early in the week after last week's Cattle on Feed report, traders seemed to take the generally bearish cold storage report in stride. Prices inched higher in light trade volume. More volatility is expected the next couple of trading sessions with end-of-the-month and end-of-quarter positioning developing. This may cause some additional movement, although traders seem to be focusing on a firming undertone to the market. Beef cut-outs: lower, $0.52 lower (select, $194.87) and down $0.43 (choice, $205.73) with light demand and moderate offerings (62 loads of choice cuts, 37 loads of select cuts, 33 load of trimmings, 12 loads of coarse grinds).
WEDNESDAY'S CASH CATTLE CALL:
Steady. Other than a few bids redeveloping midweek, early activity in the cash market is expected to remain undeveloped. Asking prices remain undeveloped, which is likely to push active trade to the end of the week.
FEEDER CATTLE:
Light buyer support slowly trickled into the market through the day with mixed early moves giving way to limited support. Futures closed $0.17 to $0.50 higher. Some additional buyer support may continue to move into the complex Wednesday as traders try to regain market confidence following recent pressure. Traders are now looking beyond cattle placement data and available beef in storage to potential demand through the fall. This could help to rekindle buyer support in most contract months. CME cash feeder index for 9/24 is $157.83, up $0.53.
LEAN HOGS:
Strong gains quickly developed across nearby lean hog futures, although limited trade left markets firm at best. Futures closed $0.25 to $1.42 higher. Traders pushed the front-month October lean hog futures contract triple digits higher to near $62.50 per cwt Tuesday. However, most of the volume developed in late-2018 and early 2019 contract months, which posted more subdued gains of 30 to 77 cents per cwt. The lack of consistent aggressive support may help to build additional gains over the next several days or weeks. Pork cuts shifted higher with primals moving in a mixed market range. Picnics posted triple-digit losses, while bellies increased by triple digits. Pork cutout values gained $0.43 per cwt, moving to $80.45 per cwt. CME cash lean index for 9/21: $60.85, up $1.76. DTN Projected lean index for 9/24: $62.05, up $1.20.
WEDNESDAY'S CASH HOG CALL:
Steady to $2 higher. Additional buyer support is moving into lean hog cash trade, allowing for firm underlying support to still be seen through the entire cash complex. Most bids are expected to be $1 per cwt higher. Wednesday runs are projected to be 468,000 head with Saturday procurement rates seen near 217,000 head.
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