GENERAL COMMENTS
It's always a good day when the cash cattle market can demand higher prices and see cattle trade $1.00 to $2.00 higher than the week's weighted average. Feedlots were able to do this because the market saw well-rounded support from a higher close throughout the futures complex, stronger boxed beef prices and another good slaughter day. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.88 with a weighted average of $83.27 on 4,491 head. December corn is up 2 1/4 cents per bushel and December soybean meal is down $0.90. The Dow Jones Industrial Average is down 94.72 points.
LIVE CATTLE:
There's not much in the market that make me prouder than when feedlots that have waited the week out get rewarded for their patience -- and that's exactly what we witnessed in Thursday's cash cattle trade. A light trade was reported in the South at $151 to $152, which is $1.00 to $2.00 higher than both Wednesday's trade and last week's weighed average. Some more cattle did trade in the North, but they were at mostly steady prices. Aside from the momentum that gradually built as the day traded on in the cash sector, the market was also propelled higher by the contracts modest gain and from the higher close in boxed beef prices. December live cattle closed $0.95 higher at $152.75, February live cattle closed $1.15 higher at $155.40 and April live cattle closed $1.17 higher at $158.90. If Friday's Cattle on Feed report is indeed bullish, then next week's market stands the chance at trading higher as it's seeing strong support both technically and fundamentally. Beef net sales of 13,400 mt for 2022 were primarily for Mexico (5,200 mt), Japan (2,500 mt) and Canada (1,800 mt).
Thursday's actual slaughter data shared that, for the week ending Nov. 5, steers averaged 925 pounds, which is 3 pounds lighter than the previous week, but 7 pounds heavier than a year ago. For the same week, heifers averaged 849 pounds, which is 2 pounds heavier than a week ago and 7pounds heavier than a year ago.
Boxed beef prices closed higher: choice up $0.01 ($257.10) and select up $0.39 ($231.74) with a movement of 165 loads (97.51 loads of choice, 15.84 loads of select, 13.59 loads of trim and 38.28 loads of ground beef). The choice/select spread sits at $25.36.
FRIDAY'S CATTLE CALL: Steady. It's rare for the cash cattle market to trade one day and then to turn around and see higher trade the next. Given that it's the week before a major holiday, seeing this much interest in the cash sector leads one to believe that packers are relatively short bought even though we know they have some cattle committed in into the deferred delivery.
FEEDER CATTLE:
When news broke that the UN and Russia had agreed to extend the Ukraine export corridor for another 120 days, the corn complex traded lower, but by the day's end, the market closed mixed -- slightly higher in its nearby contracts and lower in its deferred. Either way ,the feeder cattle complex jumped at the opportunity to trade higher and closed anywhere from 132 to 250 points higher by the day's end. If the grain sector continues to show weakness come Friday and into next week, and if the market does indeed receive a favorable Cattle on Feed report on Friday, then the feeder cattle market could be positioning itself to trade substantially higher in the upcoming days. January feeders closed $2.50 higher at $179.97, March feeders closed $2.25 higher at $182.50 and April feeders closed $2.12 higher at $185.77. At La Junta Livestock Commission, in La Junta, Colorado, compared to last week, steer and heifer calves traded uneven, steer calves under 550 pounds traded steady to $2.00 higher except those weighing 450 to 500 pounds as they traded $3.00 to $5.00 higher, steers weighing 550 to 600 pounds traded $2.00 to $3.00 lower, and steers over 600 pounds sold $1.00 to $3.00 higher with instances of $5.00 to $8.00 higher on the 650- to 700-pound weaned calves. Feeder cattle supply over 600 pounds was 48%. The CME Feeder Cattle Index for Nov. 16: up $0.41, $175.39.
LEAN HOGS:
The lean hog complex closed mostly higher as the market found ample support from traders throughout the day and was pleased with the week's export report. It was somewhat disappointing to see pork cutout values close lower, but at this point retailers have already fulfilled their needs for the upcoming Thanksgiving holiday and anything they buy now is just to quickly cover needs. December lean hogs closed $0.60 lower at $84.97, February lean hogs closed $0.45 higher at $90.80 and April lean hogs closed $0.37 higher at $96.00. Pork cutouts totaled 252.19 loads with 214.82 loads of pork cuts and 37.37 loads of trim. Pork cutout values: down $1.00, $92.63. Thursday's slaughter is estimated at 493,000 head - 3,000 head more than a week ago and 14,000 head more than a year ago. Wednesday's hog slaughter was revised to 488,000 head, 5,000 head less than what was originally stated. The CME Lean Hog Index for Nov. 15: down $0.31, $88.22.
Pork net sales of 25,200 mt for 2022 were primarily for Mexico (15,300 mt), Japan (4,300 mt) and Canada (1,900 mt).
FRIDAY'S HOG CALL: Lower. Given that packers have already fulfilled their needs for the week, they'll likely show little interest in Friday's cash market.
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