GENERAL COMMENTS:
Limited buyer support trickled back into the live cattle futures complex through most of the session with nearby contracts holding single-digit gains in most trade, while slightly more active buyer support is seen in the deferred market. The support developed in feeder cattle trade as November through May contracts posted firm upward momentum with traders picking up where they left off last week. The higher corn market seemed to have little impact on cattle futures, but traders are starting to focus more on long-term direction than short-term trade interest. Hog futures took the opportunity to retract previous gains once again, as traders still try to find a stable market range. Hog prices moved lower on the National Direct Afternoon Hog Report in moderate trade, falling $0.64 with a weighted average of $68.62 on 7,206 head. December corn is up 2 1/2 cents per bushel and December soybean meal is down $1.60 per ton. The Dow Jones Industrial Average is down 250 points and NASDAQ is down 93 points.
LIVE CATTLE:
Live cattle futures trickled higher in most contracts Monday, but the upward gains in nearby trade seemed to do very little to bring about a supportive market atmosphere. More aggressive buying developed in deferred contracts, focusing on the gains in spring and summer 2022 contracts. This is a result of higher feeder cattle trade as traders are still focusing on the potential for longer-term market support, although the lack of short-term buying interest is slightly concerning. October live cattle closed $0.05 higher at $125.62, December live cattle closed $0.07 lower at $130.17, and February live cattle closed $0.7 higher at $134.87. Cash cattle activity remains at a standstill with asking prices and bids still undeveloped. This is not unusual for a Monday, and it will likely be midweek before any significant interest is seen in most areas. The focus on steady to higher cash cattle for the week will continue to be the goal, following firm market support in average prices last week compared to the previous week.
Monday's slaughter is estimated at 121,000 head, 1,000 more than a week ago and 3,000 more than year ago totals.
Boxed beef prices closed mixed: choice down $2.15 ($281.12) and select up $1.70 ($263.64) with a movement of 107 loads (40.37 loads of choice, 23.62 loads of select, 24.63 loads of trim and 15.66 loads of ground beef).
TUESDAY'S CASH CATTLE CALL: Steady. Limited interest is expected early Tuesday following lackluster interest and market stability in futures trade. Smaller showlists could lead to firmness as the week continues, but trade will likely be seen in the last half of the week.
FEEDER CATTLE:
Front-month October futures were unable to hold early buyer support, as narrow to moderate buying in corn futures limited buyer activity. The rest of the market posted firm gains of 50 to 97 cents per cwt with traders looking for increased long-term support redeveloping in the complex. This helped to solidify November and January contracts above the $160 per cwt. There remains some uncertainty as to how much additional price support can be expected over the next couple of weeks, but with traders still not giving up on tighter overall cattle supplies in 2022, the focus on price gains will continue in the near term. October feeders closed $0.15 lower at $159.32, November feeders closed $0.57 higher at $161.72 and January futures closed $0.97 higher at $162.10. The CME Feeder Cattle Index for Oct. 8: $153.62, down $0.95.
LEAN HOGS:
Firm losses redeveloped in lean hog futures once again with December contracts leading the shift lower with a $1.32 loss. Triple-digit losses held most of the session in December contracts as traders try to balance the aggressive late September market rally with last week's market correction. Even though most, if not all traders feel that prices are nearing a sustainable price range, there remains some uncertainty if prices above $80 per cwt in December contacts will be able to be sustained given the variability in pork markets and uncertainty in outside commodity trade. This left traders slightly bearish to pork contracts, but not so bearish as to spark widespread liquidation at this point. October lean hogs closed $0.30 lower at $89.95, December lean hogs closed $1.32 lower at $80.17 and February lean hog futures closed $0.80 lower at $83.07. Pork prices trickled higher in firm underlying support in several primal cuts. Pork cutouts totaled 317.61 loads with 270.28 loads of pork cutouts and 48.33 loads of trim. Pork cutout values: up $1.02, $108.01. Monday's slaughter is estimated at 477,000 head, 14,000 more than a week ago and up 3,000 from a year ago. The CME Lean Hog Index for Oct. 8: down $0.35, $91.60.
TUESDAY'S CASH HOG CALL: Steady. Continued variability in cash cattle and wholesale pork values is still limiting overall market direction in all hog markets.
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