GENERAL COMMENTS:
It's been a tough week for the cattle contracts as traders invest in other contracts and let the cattle complex sit idle. Meanwhile, the lean hog market is bursting with support from a robust cash market and strong technical support on the board. Hog prices closed sharply higher on the National Direct Afternoon Hog Report, up $3.27 with a weighted average of $63.26 on 10,108 head. December corn is down 1/2 cent per bushel and December soybean meal is up $2.90. The Dow Jones Industrial Average is up 140.48 points and NASDAQ is up 184.84 points.
LIVE CATTLE:
Live cattle contracts closed Tuesday fully lower, seeing the biggest drawback in the first and second quarter contracts of 2021. October live cattle closed $0.22 lower at $106.47, December live cattle closed $0.42 lower at $110.17 and February live cattle closed $1.05 lower at $114.20. With a Cattle on Feed Report debuting Friday and a lower trending future's market, the hopefulness that feeders will move the market $1.00 to $2.00 higher is slimming. There's still a strong likelihood that feeders can pull off steady prices, but a lack of technical support slows the market's progress. Tuesday's cash cattle trade was again at mostly a standstill other than some cattle that sold in Iowa for $164, but there weren't enough sold to establish an accurate trend on the market. Tuesday's slaughter is estimated at 121,000 head, 1,000 head more than a week ago and 4,000 head more than a year ago.
Boxed beef prices closed mixed: choice down $0.78 ($215.44) and select up $0.48 ($206.30) with a movement of 162 loads (107.57 loads of choice, 28.71 loads of select, 8.67 loads of trim and 16.74 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: Steady. The market has yet to see a good test of trade this week, and with a weaker futures market, feedlots may settle for steady prices instead of holding out for higher prices.
FEEDER CATTLE:
Feeder cattle contracts kept with their $1.47 to $1.67 downward slide through closing and knew that support was a farfetched hope for the day. The live cattle complex fared far better, but the cattle markets will most likely fight downward pressure throughout the week as Friday's Cattle on Feed report is expected to yield another increase in placements. At Ozarks Regional Stockyards in West Plains, Missouri, compared to a week ago, steer and heifer calves traded steady to $3.00 higher with instances of $6.00 higher. The sale was heavily comprised of yearlings (high quality yearlings) that helped draw buyer interest and keep the sale lively. The CME feeder cattle index 9/21/2020: up $0.40, $142.45.
LEAN HOGS:
The downward pressure felt in the cattle industry wasn't absorbed into the lean hog sector as higher prices were not only secured on the board, but again in the cash market. Feeling more and more confident that export demand will soon flourish, the board rallied traders and moved the day's nearby contracts almost $3.00 higher. October lean hogs closed $2.72 higher at $68.32, December lean hogs closed $2.55 higher at $64.10 and February lean hogs closed $1.85 higher at $69.07. Pork cutouts total 431.65 loads with 405.20 loads of pork cuts and 26.45 loads of trim. Pork cutout values: down $1.43, $88.66. Tuesday's slaughter is estimated at 485,000 head, steady with a week ago and 15,000 head more than a year ago. Monday's hog slaughter was revised to 478,000 head. The CME lean hog index 9/18/2020: up $1.71, $71.29.
WEDNESDAY'S CASH HOG CALL: Steady to higher. Packers have yet to show any pull-back behavior, as they bought upwards of 10,000 head for $3.27 higher Tuesday afternoon.
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