GENERAL COMMENTS:
Thursday wrapped up in identical fashion to how it initially developed. Cattle contracts looked to trade higher and take advantage of the momentum in the feeder cattle market, but unfortunately, the lean hog sector can't rally any trader interest. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.84 with a weighted average of $41.36 on 8,224 head. December corn is up 1/2 cent per bushel and December soybean meal is up $2.20. The Dow Jones Industrial Average is down 225.92 points and NASDAQ is up 44.87 points.
LIVE CATTLE:
Another day, and another successful close leaves the live cattle contracts trading steadily higher into Friday. August live cattle closed $0.27 higher at $101.72, October live cattle closed $0.70 higher at $106.75 and December live cattle closed $0.50 higher at $110.45. Given that Wednesday secured the week's jump in cash cattle prices, Thursday was given the opportunity to follow in its shadow. Northern cattle sold Thursday afternoon for $160 to $162, mostly $160 ,which is $2.00 higher than last week's weighted average. Thursday's slaughter is estimated at 119,000 head - 1,000 head less than a week ago and 4,000 head less than a year ago.
Thursday's Actual Slaughter data for the week ending 7/18/2020 shared a slightly smaller kill than anticipated, but significantly lower beef carcass weights. Total slaughter amounted to 646,067 head, which was only down 0.44% from the previous week. Actual live weights were down 14 pounds averaging 1358 pounds, and dressed weights were down 8 pounds from the previous week at 830 pounds.
Boxed beef prices closed higher: choice up $0.69 ($201.80) and select up $2.01 ($191.50) with a movement of 137 loads (92.62 loads of choice, 22.41 loads of select, 2.99 loads of trim and 18.82 loads of ground beef).
FRIDAY'S CASH CATTLE CALL: Steady. Seeing that a large volume of cattle have already traded this week, Friday's trade will mostly be cleanup and follow along with the price ranges already set this week.
FEEDER CATTLE:
Feeder cattle contracts closed higher again Thursday afternoon, the week's third consecutive day of a stronger close. August feeders closed $1.05 higher at $143.02, September feeders closed $1.85 higher at $144.42 and October feeders closed $1.27 higher at $144.52. On Monday the market scaled lower after prices hit $143.85 -- only $0.83 higher than what Thursday's market closed at. Heading towards Friday, the market will dance around the pressure at $143.85 to $144.00. At Winter Livestock in Pratt, Kansas, compared to a week ago, feeder steers weighing 750 to 950 pounds sold $1.00 to $4.00 lower. Feeder heifers under 750 pounds tested a weaker market, though there weren't enough numbers to really compare, and feeder heifers weighing 750 to 900 pounds sold $1.00 to $3.00 higher. The biggest market advancement was on spayed heifers. The CME feeder cattle index 7/29/2020: down $0.60, $139.24.
LEAN HOGS:
The lean hog contracts have been trading lower the last couple of days, but Thursday's close was sharply lower in nearby contracts. August lean hogs closed $1.65 lower at $51.42, October lean hogs closed $1.50 lower at $48.32 and December lean hogs closed $1.25 lower at $49.77. It was encouraging to see large numbers of hogs trade over the last couple of days, which made the slightly lower prices less discouraging. Pork cutouts totaled 389.80 loads with 349.83 loads of pork cuts and 39.97 loads of trim. Pork cutout values: down $0.34, $67.57. Thursday's slaughter is estimated at 475,000 head, up 4,000 head from both a week and year ago. The CME lean hog index 7/28/2020: up $1.85, $52.95.
Thursday's Actual Slaughter data shared that, for the week ending 7/18/2020, hog slaughter was slightly smaller than the previous week and that carcass weights stay about the same. Total slaughter amounted to 2,517,172 head, which was 3.09% smaller than the previous week. Actual live weights were steady at 284 pounds but dressed weights were down 1 pound at 212 pounds.
FRIDAY'S CASH HOG CALL: Lower. Seeing that Thursday's close was lower in volume and lower in prices leads one to think that packers were aggressive earlier in the week but have secured the bulk of the hogs needed, at least for the near future.
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