General Comments
The full resume of higher prices in the corn contracts has drawn the attention of the livestock contracts and left the contracts to trade fully lower into Thursday's afternoon. Even after posting moderate gains throughout Wednesday's trade, the feeder cattle contracts find themselves taking the biggest losses that the day has thus far offered with Wednesday's support nowhere to be found. The cash cattle market is still quiet without bids having been renewed. March corn is up 8 cents per bushel and March soybean meal is up $6.70. The Dow Jones Industrial Average is up 117.36 points and NASDAQ is up 58.37 points.
LIVE CATTLE
As time ticks closer and closer to the noon hour, there's been some mild support develop in the deferred live cattle contracts while the rest of the complex continues to trade lower. February live cattle are down $0.45 at $111.80, April live cattle are down $0.62 at $116.85 and June live cattle are down $0.32 at $114.75. The from feed prices and lack of interested traders has caught the livestock contracts in a position to have a less than desirable day. Even with boxed beef prices being higher the cash market sits idly as packers are reluctant to spark too much interest in the cash market. With the trade that's developed over the last two days its appearing that the week's cash trade could be essentially over other than a little clean up business here and there. Southern live cattle traded for $108 to $112, mostly $110 which is $1.00 to $2.00 lower than a week ago. Norther dressed cattle traded from $171 to $173 which is $4.00 softer than a week ago.
Beef net sales of 16,800 mt reported for 2021, increases were primarily for South Korea (4,900 mt, including decreases of 300 mt), Japan (4,100 mt, including decreases of 300) and China (2,800 mt, including decreases of 200 mt).
Boxed beef prices are higher: choice up $2.49 ($213.49) and select up $2.10 ($201.16) with a movement of 73 loads (35.46 loads of choice, 12.09 loads of select, 5.10 loads of trim and 20.67 loads of ground beef).
FEEDER CATTLE
After having a successful day, trading fully higher throughout Wednesday's hours, the feeder cattle contracts have sunk back to trading lower and are again pressured by the rising cost of corn. January feeders are down $1.17 at $132.40, March feeders are down $1.37 at $132.90 and April feeders are down $1.32 at $135.35. With pressure being ample the complex comes up against the support plane of $132.50 once again and could pressure enough to close beneath its threshold. Feeders continue to count their blessings and are thankful that the demand in the countryside has been as strong as it has, but with buyers having restocked a lot of their empty pens many are worried about the weeks to come with corn prices showing no intensions of retracting.
LEAN HOGS
Falling lower like the cattle contracts, the lean hog contracts waltz into Thursday's afternoon without support appearing to be likely before the day's end. February lean hogs are down $0.20 at $66.62, April lean hogs are down $0.55 at $72.35 and June lean hogs are down $0.65 at $84.52. The one positive thing to see Thursday morning was that even though cash prices are lower, the bottom end of the cash scale jumped $2.00 from $44.00 to $46.00 -- every little bit helps.
Pork net sales of 23,800 mt reported for 2021, increases primarily for Mexico (6,600 mt, including decreases of 700 mt), Japan (3,400 mt, including decreases of 200 mt) and South Korea (3,300 mt, including decreases of 500 mt).
The projected lean hog index for 1/13/2021 is up $0.39 at $65.87 and the actual index for 1/12/2021 is up $0.99 at$65.48. Hog prices are lower on the National Direct Morning Hog Report, down $0.50 with a weighted average $53.70, ranging from $46.00 to $56.00 on 5,820 head and a five-day rolling average of $54.81. Pork cutouts total 150.27 loads with 131.35 loads of pork cuts and 18.92 loads of trim. Pork cutouts are higher: choice up $5.54, $83.67.
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