General Comments
Cattle contracts are bound and determined to rally into Monday afternoon trade and, with how much support the January feeder cattle contract is attracting, the complex may test the new market limits before the day is over. Meanwhile the lean hog market is having a modest rally with cash hog prices seeing an uptick in price too. December corn is up 1 1/2 cents per bushel and December soybean meal is up $2.90. The Dow Jones Industrial Average is up 1,282.08 points and NASDAQ is up 80.09 points.
LIVE CATTLE
Rolling off last week's excitement as cattle feeders were able to push the cash market substantially higher and the board traded stronger throughout the week, Monday's live cattle market is favoring cattle feeders again. December live cattle are up $3.10 at $111.75, February live cattle are up $2.57 at $114.72 and April live cattle are up $2.05 at $118.10. As the markets jumps ahead of the 100-day moving average ($109.19) and 40-day moving average ($109.46) the underlying tone grows more optimistic as support builds. Following last week's stout cash cattle trade, showlists are lighter in all regions and feedlots are expected to price cattle higher again.
Last week's negotiated cash sales totaled 124,710 head with 91,045 committed for delivery in the next two weeks, and the remaining 33,665 head for delivery in the following 15 to 30 days.
Boxed beef prices are higher: choice up $0.28 ($214.60) and select up $1.95 ($200.44) with a movement of 55 loads (19.80 loads of choice, 7.34 loads of select, 13.01 loads of trim and 15.13 loads of ground beef).
FEEDER CATTLE
The feeder cattle market is having a stellar Monday -- rallying close to $5.00 higher in nearby contracts. November feeders are up $3.57 at $141.27, January feeders are up $4.85 at $140.77 and March feeders are up $4.35 at $139.52. With the expanded limits allowing the market to scale higher in a faster manner, the market is pushing for all that it can take as traders are willing and ready to invest in the market. The hardship endured earlier this year pinched producers' profitability immensely, but there's a lot of upside potential for the feeder cattle market and live cattle market heading forward.
LEAN HOGS
Even though the lean hog market isn't seeing the vastly higher surge in prices that the cattle contracts are seeing, the market's nearby contracts are rallying in a respectable manner considering that the market's upside potential is limited. December lean hogs are up $0.75 at $65.65, February lean hogs are up $0.70 at $67.72 and April lean hogs are up $0.17 at $70.60. Cutout values have been a mixed case here as of late as the market dips higher and then lower, but in Monday's combination of higher midday cutout values and a slightly stronger cash market -- the lean hog market is having a nice rally of its own.
The projected lean hog index for 11/6/2020 is up $0.01 at $71.13, and the actual index for 11/5/2020 is down $0.40 at $71.12. Hog prices are higher on the National Direct Morning Hog Report, up $0.56 with a weighted average of $60.81, ranging from $55.00 to $63.00 on 4,005 head and a five-day rolling average of $60.18. Pork cutouts total 193.05 loads with 181.31 loads of pork cuts and 11.75 loads of trim. Pork cutout values: up $2.11, $86.17.
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