GENERAL COMMENTS:
As the markets rounded the corner of the noon hour Tuesday, support appeared from the cash cattle market in the afternoon with Northern feedlots able to push the market $3.00 higher and cattle futures rallied through the day's close. Meanwhile the lean hog complex still felt some pressure in its nearby contracts but still closed mostly higher. Hog prices closed higher on the National Direct Afternoon Hog Report, up $2.02 with a weighted average of $61.77 on 7,160 head. March corn is down 10 cents per bushel and March soybean meal is up $0.80. The Dow Jones Industrial Average is up 95.83 points and NASDAQ is down 89.54 points.
LIVE CATTLE:
If the cash cattle market is rallying through the doggish spell between Christmas and New Year's, I'm excited to see what the market does after the New Year! Throughout the day some trade developed in the North for $220, which is $3.00 higher than last week's business. Upon seeing the market's higher cash cattle trade, traders eyed the higher boxed beef prices and nodded at the day's aggressive slaughter pace and ultimately opted to support the futures through the day's close. December live cattle closed $1.17 higher at $138.47, February live cattle closed $0.12 higher at $139.40 and April live cattle closed $0.27 higher at $143.95.
Tuesday's slaughter is estimated at 122,000 head -- 2,000 head more than a week ago and 4,000 head more than a year ago.
Boxed beef prices closed higher: choice up $0.18 ($264.66) and select up $0.91 ($256.09) with a movement of 123 loads (81.24 loads of choice, 15.54 loads of select, 8.59 loads of trim and 17.82 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: Steady. Seeing the North able to advance prices $3.00 stronger, prices will likely hold there in the North. But given that the South has yet to really trade any cattle, that market still has to be determined. Given the influence the North's market will have on the South, it's likely that the Southern market will see an increase as well.
FEEDER CATTLE:
The cash cattle market came through, pushed prices higher and lent the feeder cattle market the support it desperately needed. Helping matters as well was the plumet in corn prices as the nearby corn futures contract endured a 10-cent drop. Sale barns are mostly closed this week and won't truly reopen until after the first of the year; but when they do it's likely they will find impeccable interest as the cash cattle market is rallying, which always invigorates feeder cattle buyers. January feeders closed $1.15 higher at $163.55, March feeders closed $1.95 higher at $165.22 and April feeders closed $1.60 higher at $168.52. The CME feeder cattle index 12/27/2021: up $0.42, $159.56.
LEAN HOGS:
One would have thought the $2.02 jump in the cash hog market would have been enough support amid the slightly stronger pork cutout to pull the nearby contracts of February and April to round out the day higher like the rest of the complex. But as the day closed, the contracts kept their lower tone, which is likely being pressured by the unknown nature of how Prop12 will fully affect the marketplace and the slower pace at which processing plants have been running the last couple of days. But the deferred contracts still closed mildly higher as producers are looking forward to manageable supplies and hopefully continued strong demand. February lean hogs closed $1.02 lower at $82.62, April lean hogs closed $0.17 lower at $87.55 and June lean hogs closed $0.52 higher at $98.80. Pork cutouts total 340.94 loads with 304.20 loads of pork cuts and 36.74 loads of trim. Pork cutout values: up $0.56, $86.89. Tuesday's slaughter is estimated at 480,000 head -- 4,000 head more than year ago and 30,000 more than a year ago. Monday's slaughter was revised to 473,000 head -- 7,000 head less than what was originally stated. The CME Lean Hog Index 12/23/2021: down $0.51, $71.16.
WEDNESDAY'S CASH HOG CALL: Steady. After a $2.00 increase and slightly weaker processing speeds, I'd bet that hog prices trend steady through Wednesday.
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