Thursday Midday Livestock Market Summary - Livestock Contracts Scale Lower

General Comments

Heading into Thursday's afternoon trade, the livestock contracts are losing their strength and have turned to mostly lower trade. Cash cattle trade is getting a little more attention as packers and feeders seem to be finding some middle ground in Iowa on a small test. December corn is steady and December soybean meal is down $1.10. The Dow Jones Industrial Average is up 18.15 points and NASDAQ is up 18.99 points.

LIVE CATTLE

Live cattle contracts have sunk to the pressure building as the noon hour approaches, turning most of the complex fully lower. August live cattle are up $0.07 at $102.37, October live cattle are down $0.62 at $106.82 and December live cattle are down $0.85 at $110.80. A tough game of hard ball is keeping the cash cattle market interesting as packers irritably up their bids to $162 in the Northern Plains and other than a small sampling of cattle in Nebraska that did sell, feedlots seem mostly uninterested as their asking prices is set at $165. In the Southern Plains asking prices are firm at $101 to $102.

Thursday's export report shared that beef net sales of 13,400 mt were reported for 2020 which was down 55% from the previous week and 35% from the prior four-week average. The three primary increases were from Japan (4,600 mt, including decreases of 600 mt), South Korea (3,200 mt, including decreases of 400 mt) and Canada (1,200 mt, including decreases of 100 mt).

Boxed beef prices are higher: choice up $1.18 ($204.75) and select up $1.17 ($191.99) with a movement of 71 loads (41.75 loads of choice, 9.66 loads select, 6.16 loads of trim and 12.97 loads of ground beef).

FEEDER CATTLE

Feeder cattle contracts are trading one shaky ground - higher one minute, lower next and are sitting dangerously close to the resistance levels that were broke through last Friday. As trade continues to panic, the understanding that the feeder cattle charts are topping out is becoming more prominent. August feeders are down $0.92 at $143.87, September feeders are down $0.05 at $146.42 and October feeders are up $0.07 at $147.37.

LEAN HOGS

Nearby lean hog contracts are able to hold steady while the rest of the livestock contracts trade lower. August lean hogs are $0.42 higher at $49.87, October lean hogs are steady at $49.30 and December lean hogs are steady at $51.47. The resistance at the $50.00 threshold has nearby contracts held hostage as support has been strong enough to move the nearby contracts higher to where deferred contracts are trading.

Pork net sales of 30,300 mt were reported for 2020 which was down 23% from the previous week and 14% from the prior 4-week average. The three primary increases were from Mexico (12,900 mt, including decreases of 200 mt), China (5,600 mt, including decreases of 3,000 mt), Canada (2,700 mt, including decreases of 400 mt).

The projected lean hog index for 8/5/2020 is down $0.14 at $52.78 and the actual index for 8/4/2020 is up $0.11 at $52.92. Hog prices are higher on the National Direct Morning Hog Report, up $0.50 with a weighted average of $39.03, ranging from $36.00 to $40.00 on 3,402 head and a five-day rolling average of $39.86. Pork cutouts total 180.04 loads with 163.67 loads of pork cuts and 16.37 loads of trim. Pork cutout values: up $4.93, $71.97.

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