GENERAL COMMENTS:
The livestock complex is off to rough Tuesday as the contracts are trending mostly lower. The feeder cattle complex is still battling the onset of higher corn price that has sent its market lower. Meanwhile, the live cattle and lean hog contracts are actively searching for fundamental support to help traders feel more confident in potentially trading higher. December corn is up 11 cents per bushel and December soybean meal is up $13.00. The Dow Jones Industrial Average is down 154.26 points.
LIVE CATTLE:
The live cattle market has bounced around in Tuesday's market, showing that it's inconclusive as to where prices should go. Unfortunately, immediate fundamental support is shaky as boxed beef prices printed mixed at midday and the cash cattle market has had little luck at getting any sizeable interest from packers over the last month. However, it is important to remember where we sit in the year, and that this time has historically been referred to as the dog days of summer for a reason. From a long-term sense, the market still sits ripe for a rally as numbers will be drastically thinner. August live cattle are down $0.67 at $137.07, October live cattle are down $1.00 at $142.35 and December live cattle are down $0.62 at $148.00. Packers still haven't shown much interest in this week's cash cattle market and it's likely that business holds off until Wednesday or later. Asking prices in the South are noted at $138, and the North has yet to disclose their initial asking prices for the week.
Boxed beef prices are mixed: choice up $1.66 ($269.77) and select down $0.30 ($244.70) with a movement of 67 loads (40.82 loads of choice, 17.66 loads of select, zero loads of trim and 8.36 loads of ground beef).
FEEDER CATTLE:
The feeder cattle market hasn't been given any relief from the rallying corn prices and continues to trend lower into Tuesday's afternoon. August feeders are down $1.32 at $177.97, September feeders are down $1.45 at $181.22 and October feeders are down $1.30 at $183.95. The market gapped lower at Tuesday's start, but the market is in no immediate pressure of trading below its breakout trend line of $176.00. The market is still seeing substantial support from buyers in the countryside as they all recognize that the number of feeder cattle available this year is going to be significantly smaller than years past.
LEAN HOGS:
The lean hog market has had a tough go come Tuesday, but if the market's fundamentals can grow stronger into the afternoon, the futures market may find modest support for Wednesday's market. Thus far, packers haven't had much interest in the cash market, but given how thin supplies are, we can assume they'll need to get more aggressive at some point this week. August lean hogs are down $0.72 at $116.50, October lean hogs are down $1.52 at $92.60 and December lean hogs are down $1.10 at $85.15. If both cash prices and pork cutout values can round out Tuesday's close with higher prices, the lean hog market may stand a chance at turning its direction around and trading higher come Wednesday.
The projected lean hog index for July 25 is up $0.40 at $119.48 and the actual index for July 22 is up $0.92 at $119.08. Hog prices are higher on the Daily Direct Morning Hog Report, up $1.73 with a weighted average of $116.05, ranging from $113.50 to $130.00 on 3,545 head and a five-day rolling average of $120.15. Pork cutouts total 167.31 loads with 157.44 loads of pork cuts and 9.87 loads of trim. Pork cutout values: down $0.93, $126.89.
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