GENERAL COMMENTS:
The livestock contracts leaned into Monday's trade and looked for support to continue their rallies. Traders didn't bat an eye at rallying their contracts higher despite a lower cash market and weaker pork cutout close. The live cattle contracts traded meekly throughout Monday's trade, as traders hope that the cash cattle market will lead the market's rally. And the feeder cattle contracts ran aggressively into the day as the corn market didn't pose any pressure. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.54 with a weighted average of $57.46 on 5,939 head. December corn is down 3/4 cent per bushel, and December soybean meal is up $9.60. The Dow Jones Industrial Average is down 12.86 points, and NASDAQ is down 7.11 points.
LIVE CATTLE:
It was a typical Monday for the live cattle market as the futures complex traded mixed, feedlots assessed their inventory and packers tallied up how many cattle they needed for the weeks ahead. By and large, the live cattle contracts chopped sideways with traders unwilling to really do much of anything in the market. If the cash cattle market can win over another week of higher cash cattle trade, then the futures market will likely follow suit and trade mildly higher. But it's unlikely at this point, with boxed beef prices showing some weakness, that traders will lead the rally. But with showlists being favorable to feedlots' position, and packers committing most of last week's cash cattle to the nearby delivery, it leads one to believe that they still need cattle. December live cattle closed $0.35 lower at $131.77, February live cattle closed $0.22 higher at $136.32, and April live cattle closed $0.07 higher at $139.97. New showlists appear to be somewhat lower in Nebraska and Colorado but lower in Kansas, and Texas. Monday's slaughter is estimated at 121,000 head -- steady with a week ago and 1,000 head more than a year ago.
Last week's negotiated cash cattle trade totaled 118,797 head -- which is the largest volume traded in the cash cattle market for the year. Of that, 76% (90,227 head) were committed for the nearby delivery, while the remaining 24% (28,570 head) were committed for the deferred delivery of the following 15 to 30 days.
Boxed beef prices closed lower: choice down $1.10 ($283.20) and select down $2.25 ($267.28) with a movement of 112 loads (65.01 loads of choice, 29.28 loads of select, 10.08 loads of trim and 7.17 loads of ground beef).
TUESDAY'S CASH CATTLE CALL: $1 to $2 higher. With packers still processing cattle at a vigorous speed, it's likely that feedlots will see higher prices again this week.
FEEDER CATTLE:
The feeder cattle contracts were able to regain some of what Friday lost as the corn market traded mostly steady (lower in their nearby contracts but slightly higher in the deferred). January feeders closed $0.75 higher at $158.47, March feeders closed $0.70 higher at $159.87 and April feeders closed $0.55 higher at $162.32. The feeder cattle contracts have been held in what feels like a tug of war between the external influences of both the live cattle/cash cattle market and the corn market. The feeder cattle complex desires to trade higher, as the live cattle market in 2022 is bound to be stronger, but doing is so nearly impossible when the grain markets are rallying with a vengeance. At West Point Livestock Auction in West Point, Nebraska, compared to two weeks ago, steer calves under 650 pounds sold $3 to $7 higher, and the 650 to 700 pounders sold steady. Heifer calves under 550 pounds sold $10 to $15 higher, and those weighing 550 to 700 pounds sold steady to $3 higher. Yearling steers and heifers sold $5 to $10 higher. This sale was a specialty sale where the cattle had to be weaned 45 days and come with a vaccination program. The CME feeder cattle index 11/12/2021: up $0.37, $155.43.
LEAN HOGS:
The lean hog market continues to grapple with conflicting views as the futures market desires to trade higher (especially in the 2022 contract months), but the market's fundamentals aren't showing the same positive outlook at least for the near term, as both cash prices and cutout values closed lower again. December lean hogs closed $0.07 lower at $75.80, February lean hogs closed $0.62 higher at $81.17 and April lean hogs closed $0.47 higher at $85.70. With holiday-shortened weeks for Thanksgiving, Christmas and the New Year all right around the corner, hog supplies are going to get backed up as processing speeds run slower schedules as workers want time off for the holidays -- which doesn't bode well for the cash market nor hog carcass weights. Pork cutouts total 312.20 loads with 274.81 loads of pork cuts and 37.38 loads of trim. Pork cutout values: down $0.78, $93.38. Monday's slaughter is estimated at 486,000 head -- 19,000 head more than a week ago and 6,000 head more than a year ago. The CME lean hog market 11/11/2021: down $1.27, $76.68.
TUESDAY'S CASH HOG CALL: Steady to somewhat lower. Packers may be a little more aggressive in this week's cash cattle market than what seems necessary, but given that next week will be shortened because of the holiday, they may want to procure more heavily this week and less next. But, still, hog supplies are plentiful, and packers won't struggle to find the hogs they desire.
No comments:
Post a Comment