GENERAL COMMENTS:
Feeder cattle contracts suffered the most Wednesday, although live cattle contracts didn't stake by unharmed either. Hog prices are lower on the National Direct Afternoon Hog Report, down $0.49 with a weighted average of $42.24. December corn is down 2 1/2 cents per bushel and December soybean meal is up $1.80. The Dow Jones Industrial Average is up 92 point and the NASDAQ is down 4 points.
LIVE CATTLE:
Live cattle markets closed lower in trend with the day's attitude. December live cattle closed $1.65 lower at $118.10, February live cattle closed $1.47 lower at $124.10 and April live cattle closed $1.37 lower at $125.67. Wednesday's drastic drop in prices begs a couple of questions: Are bears right and this is the "toppy" chart forming and the long-overdue correction they've been spewing about for weeks now? You can barely mutter that question before bulls are quick to remind you of the soaring boxed beef prices and crisis surround the pork industry with the Africa swine fever. Maybe the answer lies somewhere in the middle -- the market has traded upward now for nearly 10 weeks, and given that non-traditional beef dish holidays are right around the corner to steal attention for turkey products and trickle days off into the work week, it may be that the market is simply going to coast into 2020 steady and sideways.
Some cash trade developed after the Fed Cattle Exchange in parts of Kansas and Texas for $115, generally steady to $1.00 higher than last week's trade.
Boxed beef prices close higher: choice up $1.84 ($242.34) and select up $1.30 ($217.53) with a movement of 131 loads (66.15 loads of choice, 19.27 loads of select, 24.64 loads of trim and 21.21 loads of ground beef). Wednesday's slaughter is estimated at 118,000 head, steady with last week but 2,000 less than a year ago.
THURSDAY'S CASH CATTLE CALL: Steady. Given that cash cattle prices were able to claim $115 Wednesday afternoon, it shouldn't be frivolous to think that cash cattle prices could remain steady even though the board could keep trading lower.
FEEDER CATTLE:
Feeder cattle markets closed the lowest for the livestock complex, tumbling anywhere from $2.22 lower to $4.30 lower. November feeder cattle closed $2.22 lower at $145.57, January feeder cattle closed $4.30 lower at $142.82 and March feeders closed $3.50 lower at $143.32. On an estimated run of 2,350 head (down 50 head from the previous week) feeders at McAlester Union Livestock Auction in McAlester, Oklahoma, sold steer calves compared to last week $6.00 to $11.00 higher, and heifers $6.00 to $9.00 higher. Demand was good and quality was ok to attractive. The CME feeder cattle index 11/12/19: $147.44, up $0.20.
LEAN HOGS:
Not surprising to many, trade talks between the U.S. and China are struggling as China is struggling to commit to farm purchases. President Trump is adamant that China agreed to buy $50 million in U.S. soybeans, pork and other agricultural products annually. China, however, is leery of signing the agreement with a numerical figure attached to its commitment.
Pork contracts fared the day extremely well considering that cattle contracts closed best at $1.37 lower for the day. Lean hog contracts closed mixed, nearby contracts all lower while deferred contracts are mixed between higher and lower prices. December lean hogs are down $1.60 at $63.12, February lean hogs are down $1.00 at $74.55 and April lean hogs are down $0.27 at $81.75. Pork cutouts totaled 292.97 loads with 253.85 loads of pork cuts and 39.12 loads of trim. Pork cutout values are down $1.51 at $87.02. The CME lean hog index 11/11/19: $58.94, down $0.50.
THURSDAY'S CASH HOG CALL: Steady. Given that there's more disagreements surrounding the phase one trade agreement, it's unlikely to see cash hog trade any better than steady.
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