GENERAL COMMENTS:
Monday's livestock complex was uneventful as futures scaled lower throughout the day. The market has some fundamental components that could rally if given the right opportunity, but the board will have to show some support in order to do so. Hog prices closed higher on the National Direct Afternoon Hog Report, up $0.13 with a weighted average of $61.12 on 9,031 head. December corn is down 8 3/4 cents per bushel and December soybean meal is down $4.00. The Dow Jones Industrial Average is down 509.72 points and NASDAQ is down 14.48 points.
LIVE CATTLE:
Monday's live cattle market traded like the rest of the livestock sector: slow, quiet and lower. October live cattle closed $0.65 lower at $106.70, December live cattle closed $1.25 lower at $110.60 and February live cattle closed $0.82 lower at $115.25. With funds jumping out of the marketplace, the complex was left to scale lower without much excitement. Monday's cash cattle trade was mostly at a standstill other than a light trade (an extremely light trade) that developed in Texas for steady money. Feeders hope to keep this week's market at least steady but keep their eye on the prize of adding another $1.00 to $2.00 to the market. Monday's slaughter is estimated at 120,000 head -- steady with a week ago and 5,000 head more than a year ago.
Boxed beef prices closed higher: choice up $0.58 ($216.22) and select up $1.88 ($205.82) with a movement of 106 loads (69.79 loads of choice, 17.39 loads of select, 6.95 loads of trim and 11.53 loads of ground beef).
TUESDAY'S CASH CATTLE CALL: Steady. It wouldn't be surprising to see this week's cash cattle trade pan out like last week's in regard to timing, with trade most likely delayed until later in the week. If the board keeps trending lower, steady prices are most likely.
FEEDER CATTLE:
Feeder cattle contracts spent the day trading steadily lower as traders were painfully quiet throughout Monday's trade. October feeders closed $0.17 lower at $142.25, November feeders closed $0.20 higher at $142.72 and January feeders closed $0.42 lower at $140.92. Even though the corn market traded in favor of cattle feeders, there has to be interest and support throughout the market to react to those type of changes, and Monday's doggish trade wasn't interested in rallying. At Sioux Falls Regional Auction in Worthing, South Dakota, compared to a week ago, feeder steers sold unevenly steady and feeder heifers sold $2.00 to $3.00 lower. Buyers were less picky about vaccination programs this week, which created an extremely active market. The only thing that buyers were leery of was cattle in heavier flesh as it comes as a double expense to them. Not only do they have to pay for that weight at the sale barn, but there's a likelihood that, when those calves endure the stress of moving to a new feedlot, they will lose some of that weight, which then is a double loss as they have to regain it on the feeder's dime. The CME feeder cattle index 9/18/2020: up $0.98, $142.19.
LEAN HOGS:
The lean hog complex was able to keep deferred contracts elevated throughout the day, but nearby contracts suffered from the lackadaisical nature of Monday. October lean hogs closed $0.90 lower at $65.60, December lean hogs closed $1.97 lower at $61.55 and February lean hogs closed $1.32 lower at $67.22. The market continues to push fundamental demand as packers pushed the cash market slightly higher into the day's close and bought upwards of 9,000 head. Let's not overlook the relevance of pork demand, which secured another healthy close $2.56 higher. Pork cutouts totaled 304.07 loads with 265.38 loads of pork cuts and 38.69 loads of trim. Pork cutout values: up $2.56, $90.09. Monday's slaughter is estimated at 485,000 head -- 1,000 head less than a week ago and 41,000 head more than a year ago. Friday's hog slaughter was revised to 459,000 head. The CME lean hog index 9/17/2020: up $1.74, $69.58
TUESDAY'S CASH HOG CALL: Steady to slightly higher. Packers have reason to keep processing hogs, with domestic demand strong and international demand looming.
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