GENERAL COMMENTS:
The market has kept up with the pace set Monday as the live cattle, feeder cattle and lean hog contracts all trade higher. What helped the market confidently trade higher into Tuesday's debut was the fact that both pork cutouts and boxed beef prices closed higher Monday afternoon. If that can be accomplished again Tuesday afternoon, the market may stand a chance at continuing this rally into Wednesday. December corn is down 10 3/4 cents per bushel and December soybean meal is down $10.30. The Dow Jones Industrial Average is up 143.30 points and NASDAQ is up 26.49 points.
LIVE CATTLE:
Traders haven't tip-toed into the nearby live cattle futures Tuesday morning as both the August and October contracts see gains well over $1.00. As the market comes up against resistance, the rubber is going to have to meet the road to move the complex above longer-term resistance. Thankfully with boxed beef prices showing no immediate signs of retracting, the market sits in a fine position to rally, as the cash cattle market is the only side of the market that's been lacking. August live cattle are up $1.32 at $123.45, October live cattle are up $1.35 at $128.62 and December live cattle are up $0.92 at $133.67. The countryside sits quietly heading into Tuesday afternoon without any bids being noted. Asking prices in the South are marked at $122-plus and in the North at $199-plus. The market isn't expecting to see much develop until Wednesday or later.
Boxed beef prices are higher: choice up $4.06 ($285.06) and select up $2.63 ($266.01) with a movement of 56 loads (27.06 loads of choice, 11.95 loads of select, 10.61 loads of trim and 6.52 loads of ground beef).
FEEDER CATTLE:
With corn prices trending lower, boxed beef prices scaling higher and live cattle futures rallying, why shouldn't the feeder cattle market be rallying? The feeder cattle contracts are rallying amid phenomenal technical and fundamental support. It's a great week for the market to be seeing such confidence from all sides as Superior hosts their big Video Royale sale where over 184,000 head of cattle will be offered. It's important that the market trades strong for those who are consigned to the sale, but also for those who are looking to better understand where the market sits and are looking to price their calves in the next week to 10 days. And with corn continuing to chop sideways and the April 2022 live cattle contract hitting Tuesday's noon hour at $140.00, buyers are thankfully feeling quite confident. August feeders are up $1.22 at $159.47, September feeders are up $1.15 at $163.12 and October feeders are up $1.10 at $165.57.
LEAN HOGS:
With slaughter anticipated to be back to normal running capacity, packers buying close to 6,000 head in the morning's cash hog market and pork cutouts showing positive signs for a higher close -- the hog market is rallying! August lean hogs are up $0.77 at $108.27, October lean hogs are up $1.12 at $90.62 and December lean hogs are up $0.57 at $83.45. The support that's buzzing throughout the cattle futures has picked up momentum in the lean hog market as well and is allowing for the complex to rally confidently. If the market can round out the day with a higher pork cutout, this rally is very likely to continue.
The projected CME lean hog index for 8/2/2021 is down $0.45 at $111.59, and the actual index for 7/30/2021 is down $0.04 at $112.04. Hog prices are lower on the National Direct Morning Hog Report, down $0.54 with a weighted average of $100.45, ranging from $98.00 to $104.00 on 5,680 head and a five-day rolling average of $101.97. Pork cutouts total 176.57 loads with 158.26 loads of pork cuts and 18.31 loads of trim. Pork cutout values: up $3.05, $131.76.
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