GENERAL COMMENTS:
Cattle contracts weren't in a lackadaisical mindset heading into Tuesday's trade as both live cattle and feeder cattle contracts made significant progress. The feeder cattle contracts will be pressured Wednesday as the market bounces around a resistance level, not seeming to have a good feel for what direction trade should be heading in. Hog prices closed lower on the National Direct Afternoon hog report, down $1.01 with a weighted average of $37.42 on 12,390 head. December corn is up 1/2 cent per bushel and December soybean meal is down $0.10. The Dow Jones Industrial Average is down 104.53 points and NASDAQ is down 185.54 points.
LIVE CATTLE:
Live cattle contracts weren't going to be satisfied with anything other than fully higher on Tuesday. August live cattle closed $1.05 higher at $104.65, October live cattle closed $1.15 higher at $108.30 and December live cattle closed $0.70 higher at $111.67. This came as a pleasant gesture as feeders were wanting stronger trade again this week and set their asking prices accordingly. There was only a small sampling of cattle trade Tuesday afternoon, but stronger trends are noted. Iowa sold cattle for $163 to $167, Nebraska sold cattle for $165 and Kansas sold some fats for $103. Thursday's slaughter is estimated at 117,000 head, up 1,000 head from a week ago and steady with a year ago. Monday's slaughter was revised to 113,000 head.
Boxed beef prices closed higher: choice up $0.88 ($208.08) and select up $1.09 ($195.02) with a movement of 156 loads (84.28 loads of choice, 23.42 loads of select, 19.12 loads of trim and 28.68 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: Steady to slightly higher. Cash cattle trade will most likely be quiet Wednesday morning and then begin shortly after the online auction. As some feedlots were able to get higher prices than last week, the rest of the countryside is going to push heavily to rally those prices.
FEEDER CATTLE:
Feeder cattle contracts took Tuesday's momentum and ran full steam ahead. Last week the market traded above the $143.85 threshold, but as the week progressed, fell below the resistance and scaled lower. Seeing the drive from live cattle contracts and knowing the strength throughout both cash cattle sales and feeder cattle sales, Tuesday's market jumped higher and closed anywhere from $0.62 to $1.22 stronger. At OKC West Livestock Auction in El Reno, Oklahoma, compared to week ago, all classes of steer and heifer salves sold $2.00 to $4.00 stronger. Demand was strongly noted with a quality to average set of calves. The CME feeder cattle index 8/10/2020: down $0.28, $142.33.
LEAN HOGS:
The lean hog contracts worked effortlessly through Friday and Monday's trade to move the complex higher, but as Tuesday rolled around most of Monday's ground was lost. October lean hogs closed $2.00 lower at $51.82, December lean hogs closed $1.40 lower at $53.30 and February lean hogs closed $1.15 lower at $60.60. The cash hog market closed lower but another vast movement of hogs traded (12,390 head), aiding as a relief to producers as getting hogs moved to clean up the backlog is vital. The midday pork cutout value closed over $5.00 higher, and the afternoon's close of $0.32 isn't earth-shattering -- any encouragement to keep packers processing vigorously is a plus. Pork cutouts total 424.37 loads with 393.49 loads of pork cuts and 30.88 loads of trim. Pork cutout values: up $0.32, $70.39.
Tuesday's slaughter is estimated at 458,000 head, down 1,000 head from a week ago and 17,000 head less than a year ago. Monday's slaughter was revised to 457,000 head. The CME lean hog index 8/7/2020: up $0.58, $53.02.
WEDNESDAY'S CASH HOG CALL: Lower. With packers able to buy over 12,000 head for $1.01 lower, the market will most likely keep with its lower trend. If producers can sell large volumes of hogs, the sting of lower prices isn't as fierce.
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