GENERAL COMMENTS:
It was a good day for the livestock sector as the board closed higher, cash hog prices jumped considerably higher and boxed beef prices keep scaling stronger. Hog prices closed sharply higher on the National Direct Afternoon Hog Report, up $1.24 with a weighted average of $38.89 on 4,553 head. December corn is down 2 cents per bushel and December soybean meal is down $0.50. The Dow Jones Industrial Average is down 85.19 points and NASDAQ is down 64.38 points.
LIVE CATTLE:
Live cattle contracts were busy moving the market higher Wednesday afternoon and, in the October and December contracts, the market closed at the highest prices seen since early March. August live cattle closed $0.75 higher at $107.47, October live cattle closed $0.95 higher at $110.82 and December live cattle closed $0.85 higher at $113.80. Wednesday's cash cattle trade wasn't much different from Tuesday as southern cattle sold mostly for $106, easily $2.00 higher than last week's weighted average. And a small sampling (not enough to determine a trend for the week) of northern dressed cattle traded for $169 to $170.
Wednesday's slaughter is estimated at 119,000 head, 2,000 head more than a week ago and 1,000 head more than year ago.
Boxed beef prices are higher: choice up $2.18 ($223.04) and select up $1.00 ($205.65) with a movement of 179 loads (79.83 loads of choice, 32.51 loads of select, 47.35 loads of trim and 19.71 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: Steady, unless the North rallies for higher prices. The market has been set in the South as a considerable volume of cattle have traded, but the North isn't in the same boat. Feeders are eager to get their asking prices and trade could easily wait until Friday to pressure packers into paying more.
FEEDER CATTLE:
Feeder cattle contracts closed higher in nearby contracts but lower in deferred. Thankfully, the spirit throughout the country is seeming to carry the board modestly higher as producers have been treated extremely well once again this week on the specialty sales. Though the board is trading higher, the market is cautious not to rally to recent tops as resistance is strong. August feeders closed $0.32 higher at $143.55, September feeders closed $0.40 higher at $146.00 and October feeders closed $0.42 higher at $146.80. The CME feeder cattle index 8/18/2020:
Watching both the Superior and Western Video Market sales has been invigorating for cattlemen as prices continue to spur encouragement into the marketplace. Western Video Market sold feeders Monday and Tuesday, and those cattle were extremely well received. Sharing some strong lots that sold, some weaned steers weighing 625 pounds, with a shipping date of 11/20/2020, sold for $162. A group of steers weighing 575 pounds with a shipping date of 10/20/2020 sold for $171. Another group of steers weighing 650 pounds, that are to be shipping 10/10/2020, sold for $161. And some weaned steers weighing 700 pounds with a shipping date of 1/21/2021 sold for $146.
The market hasn't had a chance to really test the bred cow market, but Wednesday afternoon Superior rounded up the buyers and prices were quite commendable, especially when considering that feed costs could be an issue this fall/winter. A set of young black bred cows weighing 1,100 pounds sold for $1,675. A fancy set of AI bred Red Angus heifers weighing 950 pounds sold for $1,475 and a uniform set of AI bred red SimAngus heifers weighing 975 pounds sold for $1,475.
LEAN HOGS:
Lean hog contracts were willing to raise the market higher but were reluctant to move too close to the resistance at $54.00. October lean hogs closed $1.12 at $52.55, December lean hogs closed $0.40 higher at $53.57 and February lean hogs closed $0.02 higher at $61.15. A higher close on the board, higher cutout values and a much stronger cash market leaves the market ready to the later part of the week's trade and excited to do business. Pork cutouts totaled 334.12 loads with 293.41 loads of pork cuts and 40.71 loads of trim. Pork cutout values: up $0.93, $74.99. Wednesday's slaughter is estimated at 484,000 head, 3,000 head more than a week ago and 4,000 head more than a year ago. The CME lean hog index 8/17/2020: up $0.34, $54.81.
THURSDAY'S CASH HOG CALL: Steady. Wednesday's cash hog trade was commendable, but given that it was only on 4,500 head, packers may not need hogs, as their volume wasn't exuberant Wednesday afternoon.
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