GENERAL COMMENTS:
It's been a productive week for cattle markets and a depressing market for lean hog producers once again. Prices are lower on the National Direct Afternoon Hog Report, down $0.10 with a weighted average of $48.95. December corn is down 3/4 cent per bushel and December soybean meal is down $0.50. The Dow Jones Industrial Average is up 280.31 points and NASDAQ is up 87.09 points.
From Friday to Friday, livestock futures contracts scored the following changes: December live cattle up $3.45 and February live cattle up $3.15; November feeder cattle up $3.75 and January feeder cattle up $4.40; December lean hogs down $0.47 and February lean hogs down $0.77.
LIVE CATTLE:
In less than two months, the December live cattle market has gained nearly $20.00. Just when it seems like the bears may be right, the market grabs another pen of fats, processes them and sells them for higher money yet again. If there is one thing that has saved the fall fat cattle market, it is, without a doubt, demand that has kept this boat sailing. Harmony is a rare tune that whistles in the cattle industry, and especially in recent times, but with packers being able to pay feeders more money each week and still netting a profit themselves -- the cattle industry isn't such a bad place to be after all.
A light to moderate trade developed in the North at $175 to $180, which is $5.00 higher than last weeks weighted average. Live cattle have traded at $113 and have been bid up to $115. It wouldn't be unlikely to see Saturday trade and higher prices yet again.
Closing boxed beef prices are up yet again: choice up $1.02 ($233.20) and select up $1.02 ($207.51) with a total movement of 79 loads (31.45 loads of choice, 25.66 loads of select, 6.13 loads of trim and 15.75 loads of ground beef). Friday's slaughter is estimated at 115,000 - which is 7,000 more than a week ago, and 3,000 less than a year ago.
MONDAY'S CASH CATTLE CALL: Steady. Monday isn't a fun market to call, let alone guess the moral. Fat cattle hardly ever sells on Monday and Tuesdays. It will be interesting to watch the fat cattle trade over the next couple of weeks. Will packers keep processing speeds wrapped up or will they sit on the cattle that are in their pens now and not worry about actively buying, because they now have cattle bought with delayed delivery? The biggest driving force will be demand and the boxed beef's ability to remain steady or grab for higher prices yet again.
FEEDER CATTLE:
On an estimated run of 4,895 (up 1,520 head from the previous week) Ogallala Livestock Auction in Ogallala, Nebraska sold steer calves under 700 pounds steady to $7.00 higher, heifers under 700 pounds were $2.00 to $5.00 higher and demand was noted to be good. Accompanied with support from both the live cattle market and the vigorous sales throughout the countryside, the feeder cattle market has held its own and closed with fancy gains Friday afternoon. November feeder cattle are up $1.52 at $149.12 and January feeder cattle are up $1.32 at $146.00. The CME feeder cattle index 10/31/19: up $0.76 at $145.99.
LEAN HOGS:
We said it earlier in the live cattle section, but it's evident that a market that has lash demand for its product prospers. After hearing that trade conversations with China are going well and as planned, producers may be able to keep their hopes up that an export outlet will soon be opened. With cash trade weakening and pork producers barely able to break even, things are getting tough in the hog industry, especially with weights on the rise.
The lean hog market closed mixed. Nearby contracts lower, deferred contracts showing some support. December lean hogs closed $1.55 lower at $64.45 and February lean hogs closed $0.75 lower at $72.57. Pork cutouts totaled 242.05 loads with 197.60 loads of pork cuts and 44.46 loads of trim. Pork cutout values: down $0.41 at $75.64. The CME lean hog index 10/30/19: down $0.39 at $62.74.
MONDAY'S CASH HOG CALL: $1.00 lower. With the board closing lower and no push for packers to actively buy hogs, Monday will probably follow in its typical suit and be lower.
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