Thursday Midday Livestock Market Summary - Traders Approach Contracts Cautiously

GENERAL COMMENTS:

Traders have cast a cautious tone across the livestock complex as they've aggressively supported the contracts over the past two weeks and are now taking a mere pause. It's likely the market will trade somewhat lower to steady through Thursday's end and look for continued fundamental support again next week. December corn is down 4 1/4 cents per bushel and December soybean meal is up $6.00. The Dow Jones Industrial Average is up 291.59 points.

LIVE CATTLE:

The cash cattle market is higher but that's not seeming to encourage traders into pushing the futures contracts any higher. December live cattle are down $0.22 at $153.35, February live cattle are down $0.25 at $156.77, and April live cattle are down $0.12 at $159.45. A light trade has developed in parts of the South for $150, which is $2.00 higher than last week's weighted average. Otherwise asking prices remain firm at $151 to $152 in the South and $155 to $156 in the North. More business is expected to develop ahead of Thursday's end, but packers are going to need to get more aggressive if they're going to get the number of cattle bought they intended. Thankfully boxed beef prices are still seeing excellent demand, but the day's export report was lukewarm as cattlemen had hoped to see a strong export sale.

Beef net sales of 14,100 metric tons (mt) for 2022 were primarily for South Korea (4,600 mt), Japan (2,700 mt) and China (2,600 mt).

Boxed beef prices are higher: choice up $0.48 ($261.34) and select up $3.02 ($231.62) with a movement of 72 loads (38.39 loads of choice, 12.12 loads of select, zero loads of trim and 21.93 loads of ground beef).

FEEDER CATTLE:

You'd think the feeder cattle market would be trading higher as the corn complex is trending $0.04 lower into Thursday afternoon, but with the live cattle complex drawing back, feeders are leery. November feeders are down $0.32 at $178.50, January feeders are down $0.45 at $180.80 and March feeders are down $0.32 at $182.72. Buyers in the countryside are still in a tough position as they want to get their orders filled but they've got to do so carefully as they have thin margins to work with and the runs of feeder cattle have been lighter than expected.

LEAN HOGS:

Oddly enough, the lean hog complex is trending lower into Thursday afternoon even after the market was met with a supportive export report. It was not only strong for the market to move 20,300 mt of pork, but to also see China as the second most aggressive buyer this week. But traders have been rather supportive of the lean hog complex over the last two weeks so today's trade could simply be nothing more than a moment of pause to allow the market to catch its breath. December lean hogs are down $3.10 at $85.40, February lean hogs are down $2.62 at $88.37 and April lean hogs are down $1.87 at $92.30.

Pork net sales of 20,300 mt were primarily for Mexico (16,900 mt), China (5,600 mt) and South Korea (1,400 mt).

The projected CME Lean Hog Index for 10/26/2022 is down $0.32 at $94.15, and the actual index for 10/25/2022 is down $0.34 at $94.47. Hog prices are lower on the Daily Direct Morning Hog Report, down $6.66 with a weighted average of $91.65, ranging from $87.00 to $100.98 on 5,398 head and a five-day rolling average of $94.46. Pork cutouts total 174.05 loads with 157.11 loads of pork cuts and 16.94 loads of trim. Pork cutout values: up $2.00, $99.74.