GENERAL COMMENTS:
Wednesday morning trade was back and forth, but as the noon hour approached, cattle contracts took the lead and closed the day with moderate gains in both nearby and deferred contracts. Hog prices are up $0.66 on the National Direct Afternoon Hog Report, with a weighted average of $50.13. December corn was down 4 3/4 cents per bushel, and December soybean meal was down $3.40. The Dow Jones Industrial Average was down 486 points and the NASDAQ was down 122 points.
LIVE CATTLE:
Live cattle contracts all closed higher, posting gains anywhere from $0.30 to $1.42. Though many open-interest contracts jumped ship, the December live cattle market still found enough support to close $1.38 higher than its initial open. With open-interest contracts stepping to the sidelines, boxed beef prices being lower and an undeveloped cash market still waiting to trade, there are a lot of hoops to be jumped through before the market is truly established this week. A handful of cattle traded in parts of Kansas and Texas Wednesday afternoon, both selling live steers at $105. Live cattle equivalent index: $136.30, down $0.23.
Afternoon boxed beef prices are lower: Choice is down $0.50 (212.97) and select is down $0.15 ($185.90) with a large offering totaling 171 loads (71.40 loads of choice cuts, 48.57 loads of select cuts, 25 loads of trim and 25.63 loads of ground beef).
THURSDAY'S CASH CATTLE CALL:
Steady. With the board wavering between gains and losses, weakening boxed beef prices and a lot of cash cattle yet to sell, the verdict is largely still up in the air. If board strength continues, it's likely feedlots will stand their ground and demand $108, but if the board gives way, then it's more likely that $107 is the price to be paid again this week.
FEEDER CATTLE:
Losses in the corn contracts didn't hurt feeders' feelings one bit. Feeder cattle markets all closed higher Wednesday afternoon with the most gains seen in the nearby November contract, which closed at $141.67. If corn markets are weak again Thursday and live cattle continue to grab for higher prices, feeder cattle should follow suit.
LEAN HOGS:
Lean hog futures closed mixed with deferred contracts up as much as $0.75 while the December lean hog contract closed $0.82 lower at $69.10. With China trade deals merely being talked about and an agreement yet to be signed, there's a lot of uncertainty as to what exactly export opportunities will look like. With continued news of more African swine fever outbreaks and the United States' growing hog numbers, there's a vast need to cinch up those agreements. Pork cutout: down $1.17 at $74.12. Lean hog equivalent index: $78.86, down $1.17.
THURSDAY'S CASH HOG CALL:
Steady to $1 lower. With pork cutout values dwindling and a volatile futures board ready to swing either way, higher cash money may be a stretch.
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