Underlying support stemming from late last week remains well rooted through the livestock complex. Early morning gains in feeder cattle futures sparked additional active support through the entire livestock market. Most nearby contracts are holding firm gains at midday. March corn is up 1 1/2 cents per bushel and January soybean meal is up $1.50. The Dow Jones Industrial Average is up 72 points and NASDAQ is up 2 points.
LIVE CATTLE
Live cattle have wandered around in a narrow and mostly mixed range through most of the morning. Although the firm support in feeder cattle futures has helped to stimulate light price support in December contracts as well as summer futures trade, Limited pressure in February and April contracts is putting breaking pressure on any renewed momentum trying to develop through the complex. This could allow for mixed trade through the end of the session, allowing prices to still hover near the top end of the trading range, but just not enough momentum to break above Friday's highs.
Cash cattle markets remain generally quiet, which is not a surprise for Tuesday morning. A few cattle have been priced through the country with asking prices developing around $122 live basis in the South and $195 dressed in the North. Bids are still hard to pin down and may not become active until sometime Wednesday or Thursday. With packers buying for the upcoming shortened holiday weeks, it is uncertain how aggressive packers will become over the coming days.
Boxed beef prices are lower: choice down $3.05 ($214.03) and select down $1.41 ($204.10) with a movement of 70 loads (31.94 loads of choice, 5.47 loads of select, 8.61 loads of trim and 23.81 loads of ground beef).
FEEDER CATTLE
Moderate to firm gains have quickly moved into feeder cattle trade Tuesday morning as traders focused on the limited follow through support from corn markets. This helped to create short covering opportunities through the entire complex with nearby futures offsetting Monday's losses as price levels are neck and neck with last Friday's highs. The ability to close the week at or near $146 per cwt in spot January futures would bring additional short-term technical support to the complex, although the target is still hung around November highs above $147 per cwt.
LEAN HOGS
February lean hog futures have started to slowly erode through the morning Tuesday. Little, if any, technical shifts appear to be developing as traders are looking to adjust positions following the recent move above $70 per cwt. Moderate gains are seen in other nearby contracts as buying momentum remains strong as traders look for potential export news over the near future. February lean hogs are down $0.40 at $70.15, April lean hogs are up $0.20 at $77.67 and May lean hogs are up $0.77 at $84.67.
The projected lean hog index for 12/16/19 is unavailable at this time and the actual index for 12/13/19 is down $0.07 at $59.81. Hog prices are higher on the National Direct Morning Hog Report, up $0.22 with a weighted average of $48.26, ranging from $42.00 to $49.04 on 7,428 head sold and a five-day rolling average of $48.26. Pork cutouts total 222.62 loads with 206.13 loads of pork cuts and 16.49 loads of trim. Pork cutout values: up $0.14 at $79.70.
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