GENERAL COMMENTS:
Friday's trade hasn't been overly eventful for the livestock contracts, as traders are just seeming to dip their toes in the market. The lean hog contracts are trying to keep the momentum of Thursday's lively trade rolling, but the cattle contracts are trading mostly lower. December corn is up 3 3/4 cents per bushel, and December soybean meal is down $1.10. The Dow Jones Industrial Average is up 97.28 points, and the NASDAQ is up 7.99 points.
LIVE CATTLE
Live cattle futures are facing some moderate technical pressure in their nearby contracts, all while the market continues to march to strong fundamental support. December live cattle are down $0.87 at $129.45, February live cattle are down $0.85 at $134.90 and April live cattle are down $0.67 at $137.77. As the market trades the last couple of hours of the week before closing, traders are fully aware that the market's fundamentals are pointing to higher trade, but they seem to be unwilling to push the movement at this point. But the combination of robust processing speeds along with a rallying cash market and positivity in beef demand should give traders the confidence they need to support this rally. again next week. Friday's slaughter is estimated to be around 119,000 head (But remember, Thursday's slaughter was estimated lighter than what it ended up being, so it wouldn't be surprising to see a higher number printed this afternoon). There's not been any more cash cattle trade to speak of, as Wednesday was a big day for the market. Asking prices for cattle left on showlists are around $126 to $127 in the South and $201 plus in the North.
Boxed beef prices are higher: choice up $1.12 ($286.01) and select up $1.60 ($264.24) with a movement of 64 loads (42.87 loads of choice, 12.29 loads of select, 0.82 loads of trim and 8.16 loads of ground beef).
FEEDER CATTLE
The recent jolt in the corn market has set the feeder cattle contracts back on their heels as buyers try to gauge how much more upside the corn market truly has. Outrageous input costs will be what our children and grandchildren remember hearing about when we talk about 2021 in retrospect. From high hay prices, to a bizarre corn market, to the shortage of labor all throughout the country, everything costs more than what it did just a year ago. November feeders are down $0.92 at $156.72, January feeders are down $1.52 at $156.07 and March feeders are down $1.37 at $157.47. So long as the corn market doesn't shoot exponentially higher in the coming weeks, the feeder cattle complex should be able to rally on the shirttails of the excited live cattle market. Buyers have grown creative in their feed rations and see the upside potential of buying calves now and reaping the profits that are expected to come in 2022 when the market's dwindled cowherd really starts to be noticed.
LEAN HOGS
The lean hog complex is giving Friday its all, as the market is trying to push out the negative morale that is pushing the December and February contracts lower, all while the deferred contracts rally modestly. With not knowing if some relief will come from these mandated slower processing speeds, the nearby contracts trade hesitantly as supplies are backing up and demand is marginal. December lean hogs are down $1.02 at $74.20, February lean hogs are down $0.20 at $77.02 and April lean hogs are up $0.32 at $80.85. Cash prices and pork cutouts will both most likely close lower this afternoon as the week fizzles out ahead of the weekend.
The projected lean hog index for 10/28/2021 is down $0.81 at $79.89, and the actual index for 10/27/2021 is down $0.97 at $80.70. Hog prices on the National Direct Morning Hog Report are lower, down $1.43 with a weighted average of $60.78, ranging from $60.00 to $64.00 on 4,949 head and a five-day rolling average of $62.52. Pork cutouts total 286.29 loads with 261.01 loads of pork cuts and 25.28 loads of trim. Pork cutout values: up $2.71, $96.71.
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