GENERAL COMMENTS:
The livestock complex was hesitant about Tuesday's trade from the get-go as the market desperately needs fundamental support, but as concerns grew about the Nancy Pelosi visiting Taiwan and how that would affect the U.S. and China relationship, the futures market grew extremely quiet. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $5.19 with a weighted average of $121.33 on 9,140 head. December corn is down 15 1/2 cents per bushel and December soybean meal is up $3.80. The Dow Jones Industrial Average is down 402.23 points.
LIVE CATTLE:
The live cattle market is wading its way through the dog days of summer and you can feel the painstaking dullness that's overcome its market. As the futures complex continues to erode and cash cattle price see $1.00 or $2.00 cut out of its market weekly, it's tough to watch. However, while those factors remain true, it's imperative that we continue to fixate on both slaughter and boxed beef prices as they will likely determine the market's fate until later this fall when supplies run thin. If demand can keep packers running aggressive slaughter speeds then the market stands a chance at chopping sideways through the August and October contract months, but if demand weakens, then the downside to the market is treacherous. August live cattle closed $0.20 lower at $136.57, October live cattle closed $0.50 lower at $142.12 and December live cattle closed $0.22 lower at $148.27. The cash cattle market didn't see much trade develop other than a handful of cattle that sold in Iowa. Wednesday's market will likely see interest develop from packers and it's likely that this week's business is again steady to somewhat lower and on a thin volume. Asking prices in the South are noted at $137. Tuesday's slaughter is estimated at 124,000 head, 1,000 head less than a week ago and 1,000 head more than a year ago.
Boxed beef prices closed lower: choice down $2.14 ($268.46) and select down $1.35 ($241.55) with a movement of 157 loads (79.32 loads of choice, 27.15 loads of select, 10.98 loads of trim and 39.18 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: $1.00 to $2.00 lower. Packers will likely work the market lower again this week as they posses a lion's share of the market's leverage right now.
FEEDER CATTLE:
The feeder cattle market found no love nor favors in Tuesday's market. It's disappointing that the market had to fight outside pressures on Tuesday, as the market could have closed higher if it only had to focus on cattle market matters as opposed to the situation brewing between the U.S. and China as Nancy Pelosi visits Taiwan. With the corn market closing mostly $0.15 lower in its nearby contracts, Tuesday's feeder cattle market should have been trading higher, but instead the complex eroded. August feeder cattle closed $1.52 lower at $178.12, September feeder cattle closed $1.65 lower at $181.45 and October feeder cattle closed $1.27 lower at $184.20. Regardless of what the futures complex did, feeder cattle buyers were able to look at the corn market's regression and felt stronger about buying both calves and feeders. The CME Feeder Cattle Index for Aug. 1: down $0.34, $174.40.
LEAN HOGS:
Even with pork cutout values and cash prices both closing higher, the nearby lean hog contracts rounded out the day lower while the deferred contracts added mildly to their contracts. August lean hogs closed $0.60 lower at $119.85, October lean hogs closed $0.60 lower at $96.22 and December lean hogs closed $0.02 higher at $87.75. With sound fundamental support through closing, the lean hog market stands a significant chance at trading higher in Wednesday's market so long as outside pressures don't become too burdensome. Belly prices continue to jolt higher as this afternoon bellies jumped $26.57 higher from Monday's price, showing that American's love for bacon isn't going anywhere. Pork cutouts totaled 283.38 loads with 263.51 loads of pork cuts and 19.87 loads of trim. Pork cutout values: up $3.32, $131.02. Tuesday's slaughter is estimated at 472,000 head, 5,000 head more than a week ago and 3,000 head more than a year ago. The CME Lean Hog Index for July 29: up $0.45, $121.87.
WEDNESDAY'S CASH HOG CALL: Higher. With less than 10,000 head traded in Tuesday's market, it's likely that Wednesday's cash hog market is going to likely be aggressive. We will most likely see prices higher and larger volumes traded.
No comments:
Post a Comment