GENERAL COMMENTS:
There wasn't much trade to speak of through Friday's trade as the soybean meal and corn markets rallied, which sent both the live cattle and feeder cattle contracts retreating. Meanwhile, the lean hog market still closed higher as the complex was delighted to see China buying hogs in the week's export report. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.26 with a weighted average of $58.00 on 6,440 head. December corn is up 7 3/4 cents per bushel and December soybean meal is up $17.60. The Dow Jones Industrial Average is up 179.08 points and NASDAQ is up 156.68 points.
From Friday to Friday, livestock futures scored the following changes: December live cattle up $0.32, February live cattle down $1.03, November feeder cattle down $2.63, January feeder cattle down $1.88, December lean hogs down $0.67, February lean hogs up $1.08.
LIVE CATTLE:
The live cattle market drifted into the week's close without a lot of new excitement. The week's gusto came earlier in the week when the cash cattle market was able to trade $3.00 to $4.00 higher again this week. When Monday comes around, it will be crucial to see when packers committed the cattle they bought this week for. If a large majority of them are still being committed for the nearby delivery, then the market stands a chance at maintain this rally, but if packers are starting to push their purchases into the deferred delivery than the market may have a harder time summoning higher prices. Throughout the week Southern live cattle traded for $125 to $132, which is $3.00 higher than last week. Northern dressed cattle traded for $204 to $209, mostly at $207, which is $4.00 higher than last week. December live cattle closed $0.25 higher at $132.12, February live cattle closed $0.30 lower at $136.10 and April live cattle closed $0.35 lower at $139.90. The live cattle contracts closed lower as traders saw the rally that was occurring throughout the grain market and immediately hit the sidelines of the live cattle contracts. Friday's slaughter is estimated at 115,000 head, 3,000 head less than a week ago and 5,000 head less than a year ago. Saturday's slaughter is estimated at 58,000 head, 13,000 head more than a week ago and 6,000 head less than a year ago.
For the week ending Oct. 30, actual slaughter revealed that there were 667,715 head of cattle processed, and that steer carcass weights averaged 2 pounds more than the week before to average 920 pounds and heifers were steady at 842 pounds.
Beef net sales of 20,600 mt for 2021 were up 23% from the previous week and 39% from the prior four-week average. The three largest buyers were China (8,200 mt), Taiwan (4,300 mt) and Japan (2,200 mt).
Boxed beef prices closed mixed: choice down $0.84 ($284.30) and select up $2.24 ($269.53) with a movement of 117 loads (70.58 loads of choice, 23.31 loads of select, 12.83 loads of trim and 10.55 loads of ground beef). Throughout the week, choice cuts averaged $286.28 (down $2.36 from last week) and select cuts averaged $268.53 (up $1.74 from last week) with a total movement of cuts, grinds, and trim totaling 747 loads.
MONDAY'S CASH CATTLE CALL: Steady to $2.00 higher. Feedlots have finally grown in their confidence, regain leveraged and have pushed this market above $130 which has been done since 2017. With front-end supplies tight and demand still strong, feedlots should be able to keep the market at least steady if not something higher.
FEEDER CATTLE:
If it's not the corn market rallying, it's soybean meal that rallies and knocks the ground right out from underneath the feeder cattle contracts, as higher input costs never come with warm and fuzzy feelings. With the corn complex closing anywhere from $0.05 to $0.07 higher in its nearby contracts and the soybean meal market posting a snappy $0.15 to $0.17 rally, feeders grabbed their phones and tried to grasp what was happening in the grain markets. November feeders closed $1.07 lower at $156.25, January feeders closed $1.35 lower at $157.72 and March feeders closed $1.27 lower at $159.17. At Mobridge Livestock Exchange in Mobridge, South Dakota, compared to last week, steer calves weighing 450 to 700 pounds traded $2.00 to $5.00 lower, expect those weighing 500 to 550 which traded mostly steady. Heifer calves weighing 400 to 600 pounds sold mostly steady, but those weighing 500 to 550 pounds traded steady to $6.00 lower. The CME Feeder Cattle Index for Nov. 11: down $0.41, $155.06.
LEAN HOGS:
It was another week of choppy trade for the lean hog market with pork cutout values swinging drastically in either direction, but the market's exciting news stemmed from the announcement that the Biden administration is considering a proposal that would allow plants to run at faster speeds. Upon seeing china as an active buyer in this week's export report, the lean hog contracts trended higher, with the most aggressive rallies been in the Spring 2022 contracts. December lean hogs closed $0.50 higher at $75.87, February lean hogs closed $1.47 higher at $80.55 and April lean hogs closed $1.40 higher at $85.22. Pork cutouts totaled 320.77 loads with 281.17 loads of pork cuts and 39.61 loads of trim. Pork cutout values: down $1.09, $94.71. Upon seeing that weights for both live and dressed carcasses grew by a pound from the previous week, it's evident that front end supplies of market ready hogs are growing. Friday's slaughter is estimated at 480,000 head, 5,000 head more than a week ago and steady with a year ago. Saturday's kill is projected to be around 262,000 head, 35,000 head more than a week ago and 17,000 head less than a year ago. The CME Lean Hog Index for Nov. 10: down $0.77, $77.85.
Pork net sales of 23,300 mt for 2021 were down 49% from the previous week and 28% from the prior four-week average. The three largest buyers were Mexico (7,800 mt), China (5,800 mt) and Japan (5,400 mt).
According to the week's actual slaughter data, for the week ending 10/30/2021 hog slaughter totaled 2,551,915 head. Live weights grew by a pound from the previous week to average 289 pounds, and dressed weights also grew by a pound to average 215 pounds.
MONDAY'S CASH HOG CALL: Lower. Packers have access to all the hogs they could possibly wish for. With the holidays nearing and labor being limited, it's unlikely that they will be aggressive in the cash market.
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