While nearly all other markets closing lower Wednesday afternoon, cattle contracts were able to march higher and conduct their own rally regardless of how the other markets traded. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.80 with a weighted average of $61.76 on 6,960 head. December corn is down 14 1/2 cents per bushel and December soybean meal is down $7.30. The Dow Jones Industrial Average is down 943.24 points and NASDAQ is down 426.48 points.
LIVE CATTLE:
Keeping in their own world, both the live cattle and feeder cattle contracts closed higher. The live cattle market didn't see as much support as the feeder cattle market did, but both contracts were able to secure profits while outside markets veered lower. December live cattle closed $0.62 higher at $104.67, February live cattle closed $0.67 higher at $107.70 and April live cattle closed $0.65 higher at $111.37. Following Wednesday's delayed FCE, there was some light business that took place in Nebraska but certainly not enough to establish a good trend for the week. There was just a handle of cattle trade in Nebraska for $158 to $160. Wednesday's slaughter is estimated at 118,000 head, 3,000 head less than a week ago and steady with a year ago.
Wednesday's Fed Cattle Exchange was delayed due to technical issues but was still able to host the sale later in the day. The delayed Fed Cattle Exchange Auction listed a total of 2,012 head, of which 1,257 actually sold, 755 head were listed as unsold and none were listed as PO (passed offer). The state-by-state breakdown looks like this: Kansas 512 total head, with 151 head sold at $106.25, 361 head went unsold; Nebraska 394 total head, all of which went unsold; Texas 790 total head, with all 790 head sold at $105.50-$106.25; South Dakota 316 total head, all of which sold at $106.00. The delivery date/weighted averages breakdown is as listed: one- to nine-day delivery: 935 head total, 766 head sold, with a weighted average price of $106.04; one- to 17-day delivery 1,077 head total, 491 head sold, with a weighted average price of $105.80.
Boxed beef prices closed mixed: choice down $0.91 ($205.79) and select up $0.91 ($189.58) with a movement of 173 loads (99.48 loads of choice, 25.40 loads of select, 20.85 loads of trim and 26.91 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: Steady. Seeing that feeders have mostly waited until later in the week to market their cattle, one is led to believe that they are rooting for at least steady prices this week. If the later part of the week can continue the momentum, feeders may be able to hold at least steady prices. If boxed beef prices were rallying, as opposed to scaling lower, the market would be able to do so with ease.
FEEDER CATTLE:
The feeder cattle market had a nice rally throughout Wednesday's trade, capitalizing on traders' willingness to support the market and the corn market's weakness. November feeders closed $1.60 higher at $133.90, January feeders closed $1.52 higher at $129.95 and March feeders closed $1.47 higher at $129.52. Both the November and January feeder cattle contracts are well below the 40- and 100-day moving averages, but this week's progress has been commendable following last week's deterioration. Cattlemen in the North, along with cattlemen in the five-area feeding regions and even down into some of the Southern Plains, are experiencing cold weather and ice storms that are making it hard to truck cattle and host sales. Dodge City, Kansas, shared sharply lower receipts due to weather, and OKC West in El Reno, Oklahoma, canceled their sale as an ice storm blew through and left a lot of the town without electricity and made it extremely dangerous to haul cattle. The CME feeder cattle index for Oct. 27: down $0.32, $133.32.
LEAN HOGS:
The lean hog market is having a mixed week as support is becoming harder to come by and there's more pressure for the market to bow lower. December lean hogs closed $1.27 lower at $66.37, February lean hogs closed $1.85 lower at $66.20 and April lean hogs closed $1.62 lower at $68.75. Wednesday's cutout values were sharply lower, the steep cutback in belly prices has really pushed for the market to trade lower. On Wednesday pork bellies fell $22.31 to $121.58; pork cutouts totaled 438.52 loads with 397.06 loads of pork cuts and 41.47 loads of trim. Pork cutout values: down $5.10, $83.73. Wednesday's slaughter is estimated at 492,000 head, steady with a week ago and 16,000 head more than a year ago. The CME lean hog index for Oct. 26: down $0.70, $77.47.
THURSDAY'S CASH HOG CALL: Lower. With pressure from nearly every angle to trade lower, packers will most likely let the market trade steady to lower as there's ample reasons for the complex to keep cutting away at the market's recent advancement.
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