Thursday Closing Livestock Market Summary - Hog Futures Settle Sharply Higher Tied to Late-Year Optimism

GENERAL COMMENTS:

Northern cattle buyers threw out a few more bids Thursday (e.g., $180 to $183 dressed; $115 live), but nothing fancy enough to spark real selling interest. Cash potential in the South proved even deader. According to the closing report, the national hog base is .36 lower compared with the prior day settlement ($45.00-51.00, weighted average $49.49). The corn market closed essentially unchanged, though some buyers claimed token support linked to firm export sales. The stock market closed lower with the Dow off 27 points and the Nasdaq off 18.

LIVE CATTLE:

Live traders seem impatient waiting for greater packer spending to develop. At any rate, contracts fell generally lower, off 17 to 130. The summer of 2019 seemed to catch the most selling heat, reacting to the tune of triple-digit losses. Just under 117, spot December closed close to unchanged with last week's feedlot trade in the South. Yet bullish asking prices strongly suggest the late-year board remains too cheap. Beef cut-outs closed mixed with the choice off .67 ($212.61) and select up .03 ($198.53). Box demand was called light to moderate demand and offering.

FRIDAY'S CASH CATTLE CALL:

Steady-$2 higher. It will be do-or-die time Friday as buyers and sellers work the last corner of November in order to generate at least moderate trade volume. Asking prices should be restated around $187 in the North and $120 in the South.

FEEDER CATTLE:

Feeder contracts were powered lower by triple-digit losses. Sinking deferred live futures were obviously negative in that regard. In digging bigger discounts, traders seem convinced the cash index is likely to slide lower over the next quarter or so. CME cash feeder Index for 11/28: 147.91, off .26.

LEAN HOGS:

For the most part, lean hog futures settled 77 to 285 higher. Hog buyers reacted positively to large weekly export sales to Mexico and Japan, as well as China (the latter reinforcing ASF fears). More specifically, China was the third largest buyer of U.S. pork last week. Carcass value closed moderately higher, supported by better demand for all primals except the belly and the butt. The cut-out totaled $68.44, up .70. (DTN Projected lean index for CME cash lean index for 11/27: 56.84, off .33) CME cash lean index for 11/28: 56.56, off .27.

FRIDAY'S CASH HOG CALL:

Steady/firm. Hog buyers are expected to complete procurement chores on Friday by opening with steady/firm bids. 

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