GENERAL COMMENTS:
The support driving live cattle futures higher has been the saving grace the feeder cattle market needed as well. All in all, the livestock complex is heading into Tuesday afternoon with plenty of trade interest and somewhat supportive fundamentals. December corn is up 11 1/2 cents per bushel and December soybean meal is down $0.30. The Dow Jones Industrial Average is down 51.85 points and NASDAQ is up 63.92 points.
LIVE CATTLE:
Tuesday hasn't been a 'hem-haw around' kind of day for the live cattle contracts! When the August live cattle contract neglected to close above the 40-day moving average Monday afternoon, a downward deterioration was expected for the complex as pressure seemed to be weighing heavily on the market. But come Tuesday morning, the live cattle contracts have been rushed with support and the nearby contracts are all trading at least $1.00 higher. August live cattle are up $2.45 at $122.25, October live cattle are up $1.87 at $127.70 and December live cattle are up $1.45 at $132.82. The cash cattle market is still mostly quiet but bids of $119 to $120 have been offered in Kansas. Asking prices of $122 have been noted in the South; the North has yet to disclose prices. Some of the market's positivity could be from the fact that boxed beef prices are trading mixed and Tuesday's movement is lofty considering it's only noon.
Boxed beef prices are mixed: choice down $1.79 ($273.21) and select up $0.81 ($259.58) with a movement of 104 loads (49.02 loads of choice, 26.55 loads of select, 9.03 loads of trim and 19.75 loads of ground beef).
FEEDER CATTLE:
Even though the corn market is rallying, the feeder cattle contracts have had a change of heart and are finding confidence in the fact that the live cattle contracts are rallying, and the market continues to see strong interest from calf buyers. It may seem strange that calf buyers are running at the current market with such aggression, but if you look out to the February and April 2022 contracts, the prices of $137.17 and $139.52 look pretty shiny! Buyers know the corn market is subject to volatility as weather conditions have been fickle this year. But if they can get the calves sourced that they need and line them to hit the April board next year as fats, then there's the potential to make some money. August feeders are up $0.72 at $158.87, September feeders are up $0.90 at $161.85 and October feeders are up $1.00 at $163.85.
LEAN HOGS:
Other than the soon-to-expire July contract, the lean hog contracts are rallying as the market has found another support plane at $100.00 and continued demand from consumers is helping drive cutout values higher. August lean hogs are up $1.37 at $105.42, October lean hogs are up $1.45 at $88.77 and December lean hogs are up $1.17 at $82.32. When packers only bought 2,905 head Monday afternoon, it seemed like the cash hog market was going to run idly into Tuesday's trade. But with packers already having bought close to 4,000 head on Tuesday, packers may be anxious to keep hogs close to the knife as cutouts continue to perform well.
The projected CME Lean Hog Index for 7/12/2021 is up $0.57 at $110.67, and the actual index for 7/9/2021 is up $0.36 at $110.10. Hog prices are higher on the National Direct Morning Hog Report, up $2.12 with a weighted average of $108.81, ranging from $106.00 to $117.00 on 3,785 head and a five-day rolling average of $108.21. Pork cutouts total 235.75 loads with 215.11 loads of pork cuts and 20.64 loads of trim. Pork cutout values: up $2.32, $120.05.
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