GENERAL COMMENTS:
It was a mixed day for the livestock complex as cattle faced pushback from traders but did see cash cattle trade $1.00 higher, but the lean hog complex rallied throughout the day as it celebrated a strong export report. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $3.59 with a weighted average of $89.40 on 8,321 head. December corn is down 8 1/2 cents per bushel and December soybean meal is down $5.10. The Dow Jones Industrial Average is down 346.93 points.
LIVE CATTLE:
Traders may have kept an arm's distance from the live cattle complex throughout the day as they were discouraged right from the day's get-go with the lousy export report, but that didn't stop the cash cattle market from trading higher. A light trade was developed in the South at mostly $144 which is $1.00 higher than a week ago, and dressed cattle traded for $230 which is $1.00 higher than last week's business too. Some Northern trade was also reported at $148 as it's evident that packers are short bought and keenly aware that front-end supplies of cattle are thin and only going to become thinner as time passes by. October live cattle closed $0.65 higher at $145.32, December live cattle closed $0.05 lower at $147.87 and February live cattle closed $0.12 lower at $151.62. Thursday's slaughter is estimated at 127,000 head, steady with a week ago and 6,000 head more than a year ago.
Beef net sales of 16,400 mt for 2022 were primarily for South Korea (6,000 mt) Japan (2,200 mt) and Mexico (2,200 mt).
Thursday's actual slaughter data share that for the week ending Sept. 24, steers averaged 915 pounds, which is 3 pounds less than the previous week but 1 pound heavier than a year ago. Heifers for the same week averaged 836 pounds, which is 4 pounds more than a week ago and 3 pounds more than a year ago.
Boxed beef prices closed mixed: choice up $0.30 ($247.36) and select down $2.23 ($216.99) with a movement of 208 loads (116.51 loads of choice, 40.05 loads of select, 22.69 loads of trim and 29.10 loads of ground beef). The choice/select spread sits at 30.37.
FRIDAY'S CASH CATTLE CALL: Steady. Given that prices are now established in both regions they'll likely remain steady.
FEEDER CATTLE:
On a normal day, one would suspect that when the corn market is trading $0.07 to $0.08 lower and the cash cattle market is gaining steam that feeders would have traded higher, but that wasn't the case for Thursday's market. The feeder cattle contracts moved higher Wednesday afternoon but come Thursday the market simply ran out of technical support as traders kept a cautious distant between them and the cattle contracts. October feeders closed $0.82 lower at $175.72, November feeders closed $0.90 lower at $176.42 and January feeders closed $0.22 lower at $177.85. At La Junta Livestock Commission in La Junta, Colorado, compared to last week, steer calves traded $3.00 to $5.00 lower. Heifer calves weighing under 450 pounds were lightly tested, those weighing 450 to 500 pounds sold mostly steady, those weighing 500 to 600 pounds traded $5.00 to $8.00 lower, and those weighing 600 to 700 pounds traded steady. Yearling steers and heifers traded steady to $1.00 higher. Slaughter cows traded $5.00 to $8.00 lower and slaughter bulls sold $8.00 to $10.00 lower. Feeder cattle supply over 600 pounds was 46%. The CME Feeder Cattle Index for Oct. 5: up $0.11, $175.69.
LEAN HOGS:
While the cattle contracts had a retracting day technically, the lean hog complex took the market's strong export data as a sign to keep trading higher, and so the complex did! December lean hogs closed $1.27 higher at $77.77, February lean hogs closed $1.42 higher at $80.30 and April lean hogs closed $1.10 higher at $85.62. The market has gained momentum throughout the later half of the week, and given that the contracts gapped higher Thursday morning, traders are seeming more supportive of the market thanks to the steadiness of the fundamental support they've seen. Again, today pork cutout values closed higher (up $2.00 to $101.29 from Wednesday's close) which stemmed from both the ham and belly as they both jumped over $6.00 higher. Pork cutouts totaled 297.93 loads with 253.98 loads of pork cuts and 43.95 loads of trim. Pork cutout values: up $2.00, $101.29. Thursday's slaughter is estimated at 489,000 head, 13,000 head more than a week ago and 8,000 head more than a year ago. The CME Lean Hog Index for Oct. 4: down $0.51, $92.93.
Pork net sales of 34,300 mt for 2022 were primarily for Mexico (16,800 mt), China (10,100 mt) and Canada (1,900 mt).
FRIDAY'S CASH HOG CALL: Lower. Packers bought aggressively on Tuesday and Wednesday, which likely means that they'll show the market little interest ahead of the weekend.
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