GENERAL COMMENTS:
Keeping with the pace set early Wednesday, feeder cattle and lean hog futures are scaling higher, while live cattle futures are hesitant about this week's developments. So far, the cash cattle market is still idle with feedlots pushing for more money. March corn is down 14 1/4 cents per bushel and March soybean meal is down $11.00. The Dow Jones Industrial Average is down 41.18 points and NASDAQ is down 74.45 points.
LIVE CATTLE:
Feedlots have become accustomed to trading later in the week over the last two weeks and it has paid them dividends. Sure, moving the market only $1.00 to $2.00 higher may not seem like a big talking point, but slowly higher prices add up and the psychological strength it earns feedlots is equally as important. The live cattle contracts aren't roaring into Wednesday's trade, but merely trading modestly lower without traders paying the complex any interest. February live cattle are down $0.97 at $116.47, April live cattle are down $0.65 at $123.15 and June live cattle are down $0.22 at $119.42. The countryside has yet to see any interest from packers and, seeing that feedlots are sticking firmly to their asking prices, it wouldn't be surprising to see trade wait to develop until sometime Thursday. Asking prices in the South are at $116 to $117 and in the North at $185-plus.
The Fed Cattle Exchange Auction listed a total of 1,251 head of which 518 actually sold and 733 head were listed as unsold, as they did not meet the reserve prices, which ranged from $114 to $115. Opening prices were at $113, high bids ranged from $113 to $114. The state-by-state breakdown looks like this: Texas 1,104 total head, with 518 head sold at $114.00, 586 head unsold; Kansas 41 total head, all unsold; Oklahoma 106 total head, all unsold.
Boxed beef prices are mixed: choice down $1.38 ($232.91) and select up $1.97 ($222.70) with a movement of 99 loads (41.56 loads of choice, 5.66 loads of select, 41.37 loads of trim and 10.56 loads of ground beef).
FEEDER CATTLE:
As corn continues to trade lower following Tuesday's bearish WASDE report, feeder cattle contracts have found some relief and are actively working to trade higher. March feeders are up $0.27 at $138.92, April feeders are steady at $142.17 and May feeders are up $0.10 at $145.17. Seeing the feeder cattle contracts have been under immense pressure from the corn market for quite some time, the market has plenty of technical upside potential if fundamental support will develop and if traders will back the rally. However, before feeder cattle contracts can grow too confident the market needs to see a lower trend develop in corn.
LEAN HOGS:
With midday cash prices a stout $4.51 higher and midday pork cutout values up $3.30, the lean hog market is having a great day as it is met with strong fundamental demand and sees technical support as well. February lean hogs are up $0.82 at $73.42, April lean hogs are up $2.40 at $82.77 and June lean hogs are up $1.42 at $91.20. With pork demand continuing to show renewed interest day in and day out, the market is happy to keep trading higher into new contract highs nearly daily.
The projected lean hog index for 2/9/2021 is up $0.67 at $71.74, and the actual index for 2/8/2021 is up $0.66 at $71.07. Hog prices are sharply higher on the National Direct Morning Hog Report, up $4.51 with a weighted average of $64.30, ranging from $55.00 to $68.00 on 3,997 head and a five-day rolling average of $61.17. Pork cutouts total 172.10 loads with 144.85 loads of pork cuts and 27.26 loads of trim. Pork cutout values: up $3.30, $88.66.
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