Livestock futures contracts, particularly deferred contracts, were boosted Tuesday by a lower U.S. dollar and consolidating charts that were friendly to some upward movement as long as it didn't retest last week's highs. The bullishness for mid-2021 lean hog contracts above $80 was likely tied to a long-term outlook for continued strong export prospects. In the here and now, hog prices closed lower on the National Direct Afternoon Hog Report, off $0.24 with a weighted average of $58.66 on 10,459 head. December corn closed up 4 cents per bushel and December soybean meal closed up $6.50 per ton. The Dow Jones Industrial Average is down 167.09 points and NASDAQ is down 35.89 points.
LIVE CATTLE:
The February live cattle futures contract was the leader Tuesday, closing up $1.55 at $113.575. Meanwhile, the nearby December contract had quieter gains of only $0.90 to close at $111.325. However, the beef business has had some bullish momentum lately, with boxed beef prices rising day by day. There was also last week's impressive jump in cash cattle prices, anywhere from $3 to $9 higher than the previous week's business, which supports a firm tone for both futures and this week's cash bids. A few deals were reported Tuesday at $110 in Texas, fully steady with last week's weighted average, but the major portion of this week's activity will likely wait until Thursday or Friday, by which time the mood could certainly change. There will be a monthly Cattle on Feed report Friday afternoon, which is expected to show a 1.8% year-over-year increase in Nov. 1 cattle inventory. Monday's slaughter was seen at 121,000 head -- 1,000 more than both last week and a year ago. Fed cattle weights coming into the processing plants are finally coming down but are still 2.5% higher than a year ago at this time.
Boxed beef prices were higher: choice up $6.77 ($233.72) and select up $1.61 ($213.96).
WEDNESDAY'S CASH CATTLE CALL: Steady. The small taste of business done today in Texas may encourage others to take another bite at last week's prices.
FEEDER CATTLE:
The feeder cattle futures charts spent the Tuesday session moving upward, but not far enough to challenge last week's highs. This sideways shuffling is consistent with the indications from the countryside, which are still too uncertain to demonstrate one way or another if calf buyers are going to let the higher feed prices this week spook them or if they're prepared to keep filling lots at current price levels. The November contract closed up $0.10 at $137.375, the January closed up $1.80 at $139.725 and the March was up $1.50 at $139.175. The CME feeder cattle index for Nov. 13: up $0.33, $137.68.
LEAN HOGS:
The biggest movers among any agricultural commodities Tuesday were the ones that get the big export headlines: soybeans (up 16 1/4 cents), soybean meal (up $6.50), and hogs (up more than $2 per cwt at one point for the June 2021 contract). A sharply lower U.S. Dollar Index likely sparked that longer-term outlook for export strength, and the futures gains lasted throughout the session. The December lean hog contract closed up $0.375 at $65.525, the February contract closed up $1.85 at $65.625, and the April contract closed up $1.775 at $69.225. Pork cutouts total 437.06 loads with 389 loads of pork cuts and 48.06 loads of trim. Pork cutout values: down $2.55, $78.60. Monday's slaughter was seen at 493,000 head -- in line with a week ago but 5,000 fewer than a year ago. The CME lean hog index for Nov. 13: down $0.76 at $70.08, and the DTN projected CME lean hog index for Nov. 16: down $0.35 at $69.73.
WEDNESDAY'S CASH HOG CALL: Steady to slightly lower. There has been a trend of steady erosion in weighted average prices with lower high bids and also lower low bids.
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