GENERAL COMMENTS:
The livestock contracts are running higher into Wednesday's afternoon as the market takes advantage of trader support while the opportunity lasts. The lean hog complex is seeing robust fundamental support in the form of a strong cash hog market and in higher midday pork cutout values, but largely the cash cattle market has yet to see any cattle trade. December corn is down 6 1/4 cents per bushel and December soybean meal is down $7.10. The Dow Jones Industrial Average is up 352.11 points.
LIVE CATTLE:
The live cattle market is having a stellar day in its nearby contracts as the market works to "make hay while the sun is shining," or maybe in this case, its while traders are showing interest in the market as support has been hit and miss. August live cattle are up $1.27 at $137.85, October live cattle are up $1.67 at $143.80 and December live cattle are up $1.45 at $149.72. The August contract is selling for a $6.00 to $9.00 discount compared to the rest of the 2022 live cattle contracts, which is somewhat expected given that we are still in the beginning days of August and the market is looking for direction. If boxed beef prices and slaughter speeds continue to see strong consumer support and continue to see fast chain speeds, then there's plenty of support to drive the market higher. However, if either of those two facts weaken, then the August contract could come under pressure. The cash cattle market has only seen a handful of cattle trade and no tone has been set in the market yet. Asking prices in the South are noted at $136 to $138 and still are unknown in the North.
The Fed Cattle Exchange Auction held Wednesday reported 9 lots, totaling 1,065 head of cattle, none of which sold.
Boxed beef prices are mixed: choice up $0.29 ($268.75) and select down $0.05 ($241.50) with a movement of 64 loads (25.43 loads of choice, 8.61 loads of select, 17.90 loads of trim and 11.72 loads of ground beef).
FEEDER CATTLE:
As the nearby corn contracts see a minor $0.05 to $0.06 regression, the feeder cattle contracts are seeming to want to make up for Tuesday's lousy close as they push over a $1.00 advancement throughout the market. August feeders are up $1.25 at $179.37, September feeders are up $1.52 at $182.97 and October feeders are up $1.50 at $185.70. The support for feeder cattle and even weaned calves has been tremendous and so long as the market can keep this momentum through closing, pushing higher into Thursday should be no issue so long as outside pressures don't detail the market's focus.
LEAN HOGS:
As the lean hog complex leans into Wednesday's afternoon, the market is seeing tremendous fundamental support through higher cash prices and on a large volume of hogs traded, and in higher midday pork cutout values. Unfortunately, the market's run at higher cash and continued consumer support through pork cutouts isn't giving traders enough confidence to blow through resistance levels. Yes, the nearby lean hog contracts are trading higher, but the market isn't willing to push the complex outside of its current trading range. October lean hogs are up $0.50 at $96.75, December lean hogs are up $0.25 at $87.97and February lean hogs are up $0.02 at $90.97.
The projected lean hog index for Aug. 2 is down $0.63 at $120.94 and the actual index for Aug. 1 is down $0.30 at $121.57. Hog prices are higher on the Daily Direct Morning Hog Report, up $13.69 with a weighted average of $129.32, ranging from $114.50 to $135.00 on 21,281 head and a five-day rolling average of $124.72. Pork cutouts total 129.42 loads with 114.57 loads of pork cuts and 14.85 loads of trim. Pork cutout values: down $1.26, $129.76.
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