GENERAL COMMENTS:
The livestock complex walked away from Wednesday able to close higher in all three markets. Hog prices were lower on the National Direct Afternoon Hog Report, down $0.26 with a weighted average of $38.49 on 8,465 head. December corn is up 3 cents per bushel and December soybean meal is down $1.20. The Dow Jones Industrial Average is up 373.05 points and NASDAQ is up 57.24 points.
LIVE CATTLE:
Live cattle contracts flirted with the notion of trading lower, but as Wednesday progressed, and the rest of the livestock complex started to trade with some modest support, the live cattle contracts did as well. August live cattle closed $0.02 higher at $102.30, October live cattle closed $0.02 lower at $107.45 and December live cattle closed $0.27 higher at $111.65. Cash cattle trade got under way in Texas Wednesday afternoon, selling live cattle for $99 to $100, $2.50 to $3.50 higher than last week's average. Northern feedlots are playing tough as their asking prices remain firm, and thus far they show no intention of caving into lower money. If packers keep with their near 100,000 head a week buying pattern, they'll have to get serious about buying in the later part of the week. Wednesday's slaughter is estimated at 117,000 head, down 2,000 head from a week ago and down 3,000 head from a year ago. Tuesday's cattle slaughter was revised to 116,000 head.
Boxed beef prices closed mixed: choice down $0.67 ($203.57) and select up $0.37 ($190.82) with a movement of 152 loads (79.33 loads of choice, 29.96 loads of select, 7.99 loads of trim and 34.76 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: Steady with the week's trend. There's no doubt that the South is going to keep trading for what its been accomplishing this week, but the question lies solely on the northern cattle. Packers have already put some cattle on trucks and shipped them to the North to avoid paying higher prices, but it would be surprising if they walked away completely from the northern range.
FEEDER CATTLE:
Feeder cattle contracts closed mostly higher Wednesday afternoon but the higher close wasn't enough to break out of the toppy charts forming. August feeders closed $0.10 higher at $144.80, September feeders closed $0.15 lower at $146.47 and October feeders closed $0.22 higher at $147.30. Sales this week continue to support and reaffirm the strength that the feeder cattle sales have mustered. Seeing continued buying effort throughout the next couple of weeks is very likely as cheap corn stimulates feeders' acquisition, but the real test of the market will come when the fall run hits and numbers are plentiful. At St. Joseph Stockyards in St. Joseph, Missouri, compared to two weeks ago, steers weighing 400 to 500 pounds sold $3.00 to $5.00 stronger, steers weighing 500 to 600 pounds sold steady to $2.00 lower, steers weighing 600 to 700 pounds sold steady to $3.00 higher and the heavier steers weighing 800 pounds or more really rang the bell selling $5.00 to $6.00 higher. Heifers sold $3.00 to $5.00 higher throughout all weight groups. Demand was moderate to good and most of the cattle were fresh off green grass. The CME feeder cattle index 8/4/2020: up $0.10, $140.60.
LEAN HOGS:
The lean hog complex saw some prosperity Wednesday afternoon as contracts closed mostly stronger, and though the cash market wasn't higher, there was a significant number of hogs traded. August lean hogs closed $0.25 lower at $49.45, October lean hogs closed $0.27 higher at $49.30 and December lean hogs closed $0.90 higher at $51.47. Looking to Thursday, the market could really use a strong export report as moving product will be key in keeping packers vigorously processing. Wednesday's slaughter is estimated at 475,000 head, down 2,000 head from a week ago and down 1,000 from a year ago. Tuesday's hog slaughter was revised to 459,000 head. Pork cutouts total 354.88 loads with 314.36 loads of pork cuts and 40.52 loads of trim. Pork cutout values up $1.54, $67.04. The CME lean hog index 8/3/2020: down $0.30, $52.81.
THURSDAY'S CASH HOG CALL: Steady. With meat readily available to consumers as the retail sector is stocked again, packers need an inventive way to keep processing at vigorous speeds. Without demand pushing prices higher, cash trade will most likely be steady to somewhat lower.
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