GENERAL COMMENTS:
Strong pressure in cattle trade midweek created uncertainty as prices backed away from contract highs set early in the week. Live cattle futures led the market lower with triple-digit losses seen in all remaining 2021 contract months. Feeder cattle futures seemed to follow the market lower, but higher corn prices also had a significant part in the pullback of feeder cattle trade. Hog futures were the bright spot of the session, with strong gains returning to nearby contracts. Hog prices moved lower on the National Direct Afternoon Hog Report in moderate trade, fell $0.71 with a weighted average of $96.10 on 6,677 head. December corn is up 6 3/4 cents per bushel and December soybean meal is down $2.90 per ton. The Dow Jones Industrial Average is up 30 points and NASDAQ is up 22 points.
LIVE CATTLE:
Triple-digit losses in nearby contracts left the live cattle market generally unsupported in late day trade. At points during the session it appeared that buyers may start to slowly move into the market to help recover from early losses, but in the end, sharp losses were seen in all 2021 contract months. The focus on tighter supplies in early 2022 helped bring stability to deferred futures, but this was not enough to keep the general trend positive midweek. August live cattle closed $1.35 lower at $124.42, October live cattle closed $1.40 lower at $130.30 and December live cattle closed $1.12 lower at $136.27. Cash cattle markets were generally quiet Wednesday afternoon with only a handful of trade seen in several areas. At this point, there doesn't seem to be enough trade to establish a good market trend. This will put the emphasis on Thursday trade activity with the expectation that feeders will still look for higher prices by the end of the week. The Fed Cattle Exchange Auction today listed a total of 4,676 head, of which 578 actually sold, 445 were scratched from the auction and 3,653 head were listed as unsold, as they did not meet the reserve prices that ranged from $118 to $127. Opening prices ranged from $118 to $121.75, high bids ranged from $118.00 $122.25. The state-by-state breakdown looks like this: Texas 4,415 total head, with 578 head sold at $118 to $122, 3,392 head went unsold and 445 were scratched from the auction; Kansas 72 total head, all of which went unsold; Oklahoma 189 total head, all of which went unsold.
Wednesday's slaughter is estimated at 11,000 head, 3,000 less than a week ago and 1,000 head more than a year ago. Week to date totals are listed at 353,000 head, 14,000 less than week ago levels and 1,000 ahead year ago totals.
Boxed beef prices closed lower: choice down $0.69 ($346.89) and select down $1.21 ($315.69) with a movement of 106 loads (48.58 loads of choice, 27.06 loads of select, 20.77 loads of trim and 9.98 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: Steady to $2 higher. Cash cattle interest remains generally quiet with only a handful of sales reported. Given the recent support in futures trade and beef values feeders aggressively pricing cattle through the entire week. Most trade is likely to develop either late Thursday or early Friday.
FEEDER CATTLE:
Firm pressure developed in feeder cattle trade as traders quickly focused on the building pressure in live cattle and gains in corn prices. This is not enough to change the overall trend of the market, but the pullback from early week gains is still disappointing and could lead to additional volatility through the upcoming days. August feeders closed $0.72 higher at $159.30 September feeders closed $0.62 lower at $165.15 and October feeders closed $0.95 lower at $169.27. The CME Feeder Cattle Index for Aug. 24: $158.07, up 1.37.
LEAN HOGS:
Active gains have stepped back into the lean hog complex with traders looking for the potential of further support late in the week. This could add further fundamental support, although technical buying will still be limited as nearby contracts are range bound by the current sideways market trend. October lean hogs closed $1.77 higher at $88.75, December lean hogs closed $1.17 higher at $81.95, and February lean hog futures closed $0.77 higher at $83.70. Pork prices stabilized midweek. Pork cutouts totaled 397.20 loads with 358.19 loads of pork cutouts and 39.01 loads of trim. Pork cutout values: down $0.77, $110.24. Wednesday's slaughter is estimated at 474,000 head, 2,000 head above a week ago and down 9,000 from a year ago. Week to date slaughter is estimated at 1.24 million. The CME Lean Hog Index for Aug. 24: down $1.56, $106.34.
THURSDAY'S CASH HOG CALL: Steady. The wild swings back and forth in cash hog prices has created some uncertainty as to further direction in hog prices. Packers continue to focus on active procurement levels, while sellers try to take advantage of the higher future trade.
No comments:
Post a Comment