GENERAL COMMENTS:
It's a peaceful day where the livestock contracts are rallying into the afternoon, and the market isn't overly concerned about much. Before heading out for the Christmas festivities, make plans to look over this afternoon's Quarterly Hogs and Pigs report and the latest Cattle on Feed report. March corn is up 1 3/4 cents per bushel and March soybean meal is up $1.20. The Dow Jones Industrial Average is up 212.12 points and NASDAQ is up 127.13 points.
LIVE CATTLE:
The live cattle contracts are keeping with their rally even though the morning's export report was weaker. The cash cattle market hasn't seen any strong renewed interest, and with feedlots coming into this week extremely current, their desire to take subpar bids is slim to none. I don't foresee a lot more trade developing before the day's close even though a few bids have been offered in Nebraska at $135 live and $217 dressed. Before everyone heads out for the weekend, cattle enthusiasts are interested to see how this afternoon's Cattle on Feed report comes out. Analysts had a wide array of opinions on where placements would land, but given that the market has seen so many calves already placed and earlier than normal, I expect placements will be on the lighter side of the spectrum. December live cattle are up $0.90 at $136.65, February live cattle are up $1.40 at $138.77 and April live cattle are up $1.22 at $143.35.
Beef net sales of 12,000 metric tons (mt) for 2021 were down 30% from the previous week and 23% from the prior four-week average. The three largest buyers were China (3,800 mt), Japan (3,700 mt) and South Korea (2,800 mt).
Boxed beef prices are higher: choice up $1.21 ($263.07) and select up $2.06 ($252.89) with a movement of 64 loads (42.54 loads of choice 10.47 loads of select, 5.96 loads of trim and 5.47 loads of ground beef).
FEEDER CATTLE:
The feeder cattle contracts are rallying into Thursday afternoon as the live cattle complex lends some support amid the higher tick in corn prices. January feeders are up $0.87 at $162.65, March feeders are up $1.27 at $163.20, and April feeders are up $1.22 at $166.77. The feeder cattle contracts support really lies in the hands of the live cattle market and the interest of traders -- so long as the live cattle market continues to trade higher, the complex should be able to round out the day on a positive note.
LEAN HOGS:
The lean hog complex is rallying as the market longs for a bullish quarterly Hogs and Pigs report this afternoon. The market's export report was neutral, not really helping nor hindering the market in any regard. But with the afternoon Hogs and Pigs report expecting to unveil fewer supplies of market-ready hogs, producers are hoping that the demand the market sees now will only yield higher prices in the months to come as supplies of market-ready hogs are manageable. February lean hogs are up $0.42 at $83.77, April lean hogs are up $0.45 at $87.15 and June lean hogs are up $0.20 at $97.70. Before you get overly concerned with the $11 jump in pork cutout values, remember it's the day before Christmas break and to wait to see what the afternoon's report shows before drawing any conclusions.
Pork net sales of 28,800 mt for 2021 were down 8% from the previous week but up 5% from the prior 4-week average. The three largest buyers were Mexico (14,000 mt), South Korea (7,100 mt) and Japan (3,800 mt).
The projected lean hog index for 12/21/2021 is down $0.69 at $72.33, and the actual index for 12/20/2021 is up $0.09 at $73.02. Hog prices are lower on the National Direct Morning Hog Report, down $0.65 with a weighted average of $60.44, ranging from $59 to $65 on 3,525 head and a five-day rolling average of $59.94. Pork cutouts total 205.75 loads with 191.42 loads of pork cuts and 14.34 loads of trim. Pork cutout values: up $11, $95.67.
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