GENERAL COMMENTS:
It was another exhilarating day for the livestock complex as all three of the markets were able to close higher thanks to phenomenal fundamental support and lower grain prices. The cash cattle market didn't see any bids develop, but given that feedlots are price cattle higher again this week, trade will likely be delayed until later in the week. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $7.61 with a weighted average of $93.85 on 17,120 head. December corn is down 2 1/2 cents per bushel and December soybean meal is down $9.20. The Dow Jones Industrial Average is up 337.98 points.
LIVE CATTLE:
There's nothing like seeing some strong green advancements made in the futures market after a spell of sideways choppy trade. The live cattle complex ran higher again throughout Tuesday's market as traders applauded the strength seen in boxed beef prices and are fully aware that feedlots are gunning for higher cash prices again this week. Given that packers continue to run aggressive chain speeds, they'll likely have to support this week's cash cattle market simply to avoid becoming short bought. No action was seen in Tuesday's cash cattle market but asking prices in the South are noted at $147 to $148. It's likely that this week's trade will again hold off until Thursday or later as feedlots are in the driver's seat of the cash market. October live cattle closed $0.60 higher at $148.47. December live cattle closed $0.57 higher at $149.77 and February live cattle closed $0.57 higher at $152.77.
Tuesday's slaughter is estimated at 128,000 head, steady with a week ago and 7,000 head more than a year ago.
Boxed beef prices closed higher: choice up $2.64 ($250.78) and select up $1.67 ($221.28) with a movement of 135 loads (89.53 loads of choice, 29.22 loads of select, 4.12 loads of trim and 12.44 loads of ground beef).
WEDNESDAY'S CASH CATTLE CALL: $2.00 Higher. Packers know that their feet are going to be held to the fire in not only this week's market, but likely well into 2023 as feedlots possess the lion's share of the market with front-end supplies thin.
FEEDER CATTLE:
With corn closing $0.02 to $0.03 lower and the live cattle complex helping convince feeders that there's still more to be had in this market -- the feeder cattle complex closed higher Tuesday afternoon. The market is still trading well below it's 40-day and 100-day moving averages, but if the market can finally see some relief from the grain sector, all while being taken higher by positive reassurance from the live cattle and cash cattle market, then higher trends are quite plausible for feeders. October feeder cattle closed $0.07 higher at $174.82, November feeders closed $1.42 higher at $177.82 and January feeders closed $1.95 higher at $179.20. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week, feeder steers traded steady to $3.00 higher and feeder heifers sold $1.00 to $4.00 higher. Steer calves sold steady to $2.00 higher and heifer calves traded $2.00 to $4.00 higher. Feeder cattle supply over 600 pounds was 40%. The CME Feeder Cattle Index for Oct. 17: down $0.81, $172.27.
LEAN HOGS:
The lean hog complex didn't play silly little games when it came to trading throughout Tuesday's market, as not only did the complex trade $1.00 to $2.00 higher in its contracts, but it also saw over 17,000 head of hogs trade in the cash market for $7.61 more than Monday's market. Pork cutout values closed just slightly lower, which could pull the reins back slightly on Wednesday's market, but given the other tremendous support that's stemming from the market's vigorous chain speeds, the market could charge higher yet again. Once prices near $88.00, some resistance pressure will loom, but so long as the market's fundamentals don't change and consumers here domestically and abroad continue to support the market, taking out the resistance plane at $88.00 isn't undoable. December lean hogs closed $1.52 higher at $86.47, February lean hogs closed $1.82 higher at $87.80 and April lean hogs closed $2.15 higher at $91.75. Pork cutouts totaled 335.53 loads with 297.38 loads of pork cuts and 38.14 loads of trim. Pork cutout values: down $0.83, $102.67. Tuesday's slaughter is estimated at 490,000 head, 1,000 head more than a week ago and 10,000 head more than a year ago. The CME Lean Hog Index for Oct. 14: up $0.26, $93.35.
WEDNESDAY'S CASH HOG CALL: Higher. Even though Tuesday's market was stronger, given how fast packers are running chain speeds, they'll need to be active at least one more day in this week's cash hog market to ensure they have enough hogs for upcoming kills.
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