Thursday Midday Livestock Market Summary - Lean Hogs Jump

General Comments

Thursday has presented a change in the livestock complex as cattle contracts shift lower and lean hog complex breaks out of the short-term sideways trade. Cash cattle trade continues to be idle, but protein demand continues to fuel the boxed beef and pork cutouts higher. December corn is down 2 1/4 cents per bushel and December soybean meal is down $2.00. The Dow Jones Industrial Average is up 19.64 points and NASDAQ is up 66.03 points.

LIVE CATTLE

Live cattle contracts have sunk to lower levels as the market is starting to seem exhausted from its recent rally. August live cattle are down $0.47 at $107, October live cattle are down $0.85 at $109.97 and December live cattle are down $0.85 at $112.95. Despite trading modestly lower, the market is still supported by a stronger cash market and ambitious boxed beef prices.

Thursday's export report shared that net sales of 20,000 mt reported for 2020 which was up 69%from the previous week and 13% from the prior four-week average. The three primary increases were from South Korea (8,700 mt, including decreases of 400 mt), Japan (4,800 mt, including decreases of 300 mt) and Taiwan (1,800 mt, including decreases of 100 mt).

Boxed beef prices are higher: choice up $1.08 ($224.12) and select up $0.40 ($206.05) with a movement of 68 loads (37.49 loads of choice, 8.33 loads of select, 3.24 loads of trim and 18.80 loads of ground beef).

FEEDER CATTLE

Feeder cattle contracts have traded mostly lower through Thursday's morning as the market as felt downward pressure rising throughout the last week and was incentivized to continue to trade lower as the live cattle contracts scaled back. August feeder cattle are down $0.07 at $143.47, September feeders are down $0.20 at $145.80 and October feeders are down $0.50 at $146.30. The market's pulling back from the board isn't a country-based idea as Wednesday's feeder cattle prices throughout the nation were higher again, average $3.00 to $5.00 stronger than last week's sales.

LEAN HOGS

Taking front-and-center stage through the latter part of the week, the lean hog complex jumped to Thursday's arrival and shot higher. Fueled by technical support as cattle contracts wane lower, the market has interested traders and drawn enough support to break through both nearby and long-term resistance levels. October lean hogs are up $2.72 at $55.27, December lean hogs are up $2.15 at $55.72 and February lean hogs are up $0.82 at $61.97.

Pork net sales of 20,600 mt reported for 2020 were up 97% from the previous week, but down 27% from the prior 4-week average. The three primarily increases were from Mexico (7,800 mt, including decreases of 300 mt), China (6,500 mt, including decreases of 6,700 mt) and Japan (2,400 mt, including decreases of 300 mt).

The projected lean hog index for 8/19/2020 is up $0.33 at $55.41 and the actual index for 8/18/2020 is up $0.27 at $55.08. Hog prices are lower on the National Direct Morning Hog Report, down $0.54 with a weighted average of $38.37, ranging from $35.00 to $41.00 on 4,157 head and a five-day rolling average of $37.71. Pork cutouts total 146.83 loads with 128.38 loads of pork cuts and 18.44 loads of trim. Pork cutout values: up $2.53, $77.52.

#completeherdhealth