GENERAL COMMENTS:
Wednesday was a mixed bad for the livestock sector as cattle contracts closed lower and the week's cash cattle trade developed for $2.00 to $3.00 lower. Meanwhile, the lean hog market had a phenomenal day, seeing cash prices and nearby futures contracts jump higher. Hog prices shot higher Wednesday afternoon on the National Direct Afternoon Hog Report, up $3.49 with a weighted average of $48.97 on 8,578 head. October lean hogs are up $1.48 at $61.375, December corn is down 1 1/2 cents per bushel and December soybean meal is up $3.50. The Dow Jones Industrial Average is up 439.58 points and NASDAQ is up 293.88 points.
LIVE CATTLE:
Live cattle contracts fell lower following in the tracks of the feeder cattle complex. October live cattle closed $1.07 lower at $104.70, December live cattle closed $0.97 lower at $109.15 and February live cattle closed $0.55 lower at $113.42. Cash cattle trade broke out of the chute in the middle of the afternoon, selling in most of the five-area trading region for $101, which is $2.00 to $3.00 lower compared to a week ago. Wednesday afternoon's boxed beef movement was notable as there was 186 loads moved, showing strong demand after the Labor Day weekend and showing that packers are wanting to clear out some cooler space. Wednesday's slaughter is estimated at 120,000 head, 3,000 head more than a week ago and 4,000 head more than a year ago.
Boxed beef prices closed lower: choice down $1.87 ($222.95) and select down $0.95 ($207.51) with a movement of 186 loads (114.16 loads of choice, 32.03 loads of select, 25.10 loads of trim and 14.22 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: Steady to lower. With a considerable amount of trading on Wednesday afternoon, the week's market could be mostly established.
FEEDER CATTLE:
The feeder cattle contracts bled lower throughout the day and led the cattle complex in its downward quest. September feeders closed $0.55 lower at $138.40, October feeders closed $1.60 lower at $138.25 and November feeders closed $1.77 lower at $138.95. The optimistic group hoping that feeder cattle contracts would scale higher this week grew slimmer as the day progressed and saw the cash cattle market give up another $2.00 to $3.00. While feedlot managers sell cattle for lower money, it's hard to get overly excited about the feeder cattle market. But given that this downward trend is happening now, hopefully the market has some time to stabilize before the fall run begins. Hub City Livestock Auction in Aberdeen, South Dakota, had a larger run of feeders sell, and compared to the previous week, the best test was on steers weighing 800 to 850 pounds, and steers weighing 951 to 1,050 pounds, which sold $3.00 to $4.00 higher. The best test on heifers was the 750 to 950 weight bracket, which sold $1.00 stronger. The market's yearlings sold considerably well as they were coming off grass and in the right condition. The market had very few lightweight calves sell. The CME feeder cattle index 9/8/2020: not available at this time.
LEAN HOGS:
Hot-diggity-dog, it was good day in the lean hog world! Nearby contracts rallied over $1.00 higher through closing, the cash market surprised everyone, jumping almost $3.50 higher, and slaughter continues to run at a vigorous pace. October lean hogs closed $1.47 higher at $61.37, December lean hogs closed $1.17 higher at $59.85 and February lean hogs closed $0.77 higher at $64.40. With slaughter speeds running at a considerable pace, packers willing to pay substantially more for hogs and demand expected to remain strong -- contracts may stay elevated. Pork cutouts totaled 363.29 load with 317.10 loads of pork cuts and 46.19 loads of trim. Pork cutout values: down $0.78, $80.13. Wednesday's slaughter is estimated at 484,000 head, 10,000 head more than a week ago and 6,000 head less than a year ago. Tuesday's hog slaughter was revised to 465,000 head. The CME lean hog index 9/4/2020: up $1.89, $60.53.
THURSDAY'S CASH HOG CALL: Higher. With packers coming in with such aggression Wednesday afternoon, one would assume that they intend to continue with their aggressive slaughter pace and will be in the hunt for more hogs come Thursday.
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