GENERAL COMMENTS:
At noon, we told Annie to bar the door, but maybe we should have let her keep it open so the market could figure itself out. Of all things, the hog market that is lacking export opportunities has too much supply, and that now has the rest of the trade sector worried too because Chinese officials are expressing doubts about reaching a deal with the U.S.
Hog prices are lower on the National Direct Afternoon Hog Report, down $0.36 with a weighted average of $49.07. December corn is down 3/4 cent per bushel and December soybean meal is up $2.20. The Dow Jones Industrial Average is down 140.46 points and NASDAQ is down 11.62 points.
LIVE CATTLE:
Live cattle contracts bounced around the most Thursday, indicating that the market didn't know where to fall. Despite its varying prices throughout the day, it's a positive sign that the market was able to keep within Wednesday's parameters. December live cattle closed $1.07 lower at $117.22 and February live cattle closed $0.75 lower at $122.35. A lot of questions will be answered Friday. Was Wednesday's rally a fluke? Or will cash prices boost the board's moral and trade higher? Time will tell.
Some cash trade took place in Kansas with prices steady with Wednesday's gains -- $112.00, which is $2.00 higher than last week's weighted average. Thursday's slaughter is estimated at 118,000 head -- steady with last week, 4,000 head less than a year ago.
Closing boxed beef prices are mixed: choice up $2.13 ($232.18) and select down $0.18 ($206.49) with a total movement of 117 loads (72.67 loads of choice, 23.85 loads of select, no loads of trim and 20.69 loads of ground beef).
FRIDAY'S CASH CATTLE CALL: Steady to $1.00 higher. Feeders are holding out again this week, and with packers itching to keep getting fat checks from the retail sector, they may be anxious to buy even if it is for higher money than last week.
FEEDER CATTLE:
On an estimated run of 2,500 head (down 558 head from the previous week) Huss Livestock Market in Kearney, Nebraska, sold steer calves compared to last week unevenly steady. Heifer calves sold steady to $3.00 higher and yearling heifers sold $2.00 higher. Demand was noted to be good on yearlings with moderate to good demand on calves. Buyers preferred calves with preconditioned shots instead of calves that had just had their spring vaccines. They exited to have more calves than before, but because of icy roads and snow not as many came to town. The feeder cattle market fared better than the live cattle market did. November feeder cattle down $0.27 at $147.60 and January feeder cattle down $0.12 at $144.67. The CME feeder cattle index 10/30/19: up $0.15 at $145.23.
LEAN HOGS:
The lean hog market was the only livestock facet able to close the day higher. All nearby and deferred contracts closed $0.05 to $0.87 higher. December closed $0.22 higher at $66.00 and February lean hogs closed only $0.05 higher at $73.32. Thursday's market being able to close above Wednesday's rally was huge in the hog market. Pork cutouts totaled 327.27 loads with 293.75 loads of pork cuts and 33.51 loads of trim. Pork cutout values: up $0.61 at $76.05. The CME lean hog index for 10/29/19: down $0.38 at $63.13.
FRIDAY'S CASH HOG CALL: Steady. Given that the board captured gains above Wednesday's close, the market may have a sliver of hope to either trade steady cash Friday or maybe even some higher. Despite what the board is doing, we have to remember that the countryside is flooded with hogs and it's always tough to sell on a saturated market for more money.
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