GENERAL COMMENTS:
Both the live cattle and feeder cattle contracts were trading higher at Tuesday's start, but with the onset of higher grain prices, both the cattle contracts are now trading lower. Meanwhile the lean hog complex is keeping with its mild rally as traders expect pork demand to be noted in the day's afternoon cutout report and hope to see strong cash sales. December corn is up 3 3/4 cents per bushel and December soybean meal is down $3.70. The Dow Jones Industrial Average is down 119.23 points.
LIVE CATTLE:
The live cattle complex was too trading higher at Tuesday's beginning, but as the market notes the increase in both corn and soybean prices, its nearby contracts are trading lower while the deferred months trade mildly higher. December live cattle are down $0.32 at $152.17, February live cattle are down $0.35 at $155.47 and April live cattle are down $0.05 at $159.02. The cash cattle market isn't expected to trade until Thursday or later again this week as feedlots are again gunning for higher prices. They know that their opportunity to push this cash cattle market higher ahead of the year's end is extremely strong, and so they're setting out to do just that. Asking prices in the South are noted at $152 but are still not established in the North.
Boxed beef prices are mixed: choice up $0.75 ($264.40) and select down $1.42 ($233.04) with a movement of 72 loads (33.66 loads of choice, 21.67 loads of select, 4.18 loads of trim and 12.49 loads of ground beef).
FEEDER CATTLE:
To start the day off, the corn market was trending lower, but as the noon hour approaches, the corn complex is fronting a $0.03 to $0.04 rally in its nearby contracts and soybean prices are trending $0.22 to $0.24 higher. Unfortunately, this has taken the steam right out of the feeder cattle market as buyers have little wiggle room in their current cost of gains as prices are simply too high on the buying end (for both feeder cattle and inputs). Nevertheless, the feeder cattle contracts are back to trading lower and the market will likely trade throughout the entire afternoon with this depressed tone. November feeders are down $0.47 at $177.15, January feeders are down $0.97 at $178.47 and March feeders are down $0.57 at $181.00.
LEAN HOGS:
After closing lower Monday afternoon, the lean hog complex is back to trading higher as the market anticipates strong interest from packers in the cash market, and better demand in pork cutouts. December lean hog are down $0.05 at $84.87, February lean hogs are up $0.02 at $88.47 and April lean hogs are up $0.25 at $93.85. With Monday's aggressive slaughter, one is led to believe that packers will need to be aggressive in this week's cash hog market. And with Tuesday's morning cash report already showing a slightly higher price for cash hogs, hopefully prices get stronger as time passes by.
The projected lean hog index is unavailable at this time. Hog prices are higher on the Daily Direct Morning Hog Report, up $0.34 with a weighted average of $87.71, ranging from $83.00 to $95.00 on 4,011 head and a five-day rolling average of $94.01. Pork cutouts total 195.54 loads with 176.65 loads of pork cuts and 18.89 loads of trim. Pork cutout values: down $2.24, $97.70.
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