GENERAL COMMENTS:
It may be the week of Christmas, but the livestock complex isn't trading doggishly through Wednesday's market. Even with the nearby corn contracts pushing a $0.07 to $0.09 rally, the livestock complex is trading higher into the day's noon hour. March corn is up 8 cents per bushel and March soybean meal is up $3.00. The Dow Jones Industrial Average is up 496.48 points.
LIVE CATTLE:
How about a little midweek excitement for the live cattle market? With the futures complex roaring into Wednesday's noon hour, and the cash cattle market starting to see bids develop, the market seeming to be just now heating up. The biggest news thus far of Wednesday has undoubtedly been the action seen in the futures market. With traders pouring into the market, the spot February contract has been able to break beyond the market's resistance at $157.00. Whether or not the market will be able to sustain the move through closing remains unknown, but given that feedlots are jumping at the market's first offers in the cash sector is positive. December live cattle are up $0.97 at $156.05, February live cattle are up $1.77 at $157.35 and April live cattle are up $1.42 at $161.07. Seeing the April board break above $160 may be the encouragement that feedlots need in order to push this week's cash market higher even yet. So far bids have been offered in Kansas and Texas at $153, but that's well under the Southern Plains asking price of $156 to $157. With the board's momentum, it's likely that trade waits until Thursday to develop.
The Fed Cattle Exchange Auction held today reported 7 lots (6 lots in Texas and 1 lot in Colorado), totaling 992 head of cattle, none of which sold. Opening prices were at $153, high bids had a range of $153 to $153.75, but none of these bids met reserve prices of $156 to $157.
Boxed beef prices are mixed: choice down $0.12 ($264.93) and select up $2.21 ($236.11) with a movement of 69 loads (34.33 loads of choice, 12.40 loads of select, 2.77 loads of trim and 19.62 loads of ground beef).
FEEDER CATTLE:
The feeder cattle market isn't giving the corn market's rally any bit of attention as the market is focusing on the better interest in the entire commodity sector and especially in the better interest in cattle arena. It is surprising that the corn market's $0.07 to $0.09 rally in the nearby contracts hasn't unraveled feeder's confidence, but at this point feeders are feeling confident enough to challenge existing resistance levels and show no sign of backing down. January feeders are up $0.22 at $183.85, March feeders are up $0.90 at $185.95 and April feeders are up $0.90 at $189.37.
LEAN HOGS:
Even with cash prices trading slightly lower and pork cutout values yet again showing a lower figure at the day's noon hour, the lean hog complex is trading higher alongside the rest of the livestock contracts. Traders have dived aggressively into the market and, given that commodity sector is doing better too, eventually their attention gravitated to the livestock contracts despite fundamental support for the market showing much improvement. The cash hog market is especially interesting as only a thin volume of 2,814 head were reported this morning. The market should see a little better volume traded this afternoon unless packers are more or less done buying for the week. February lean hogs are up $2.70 at $86.95, April lean hogs are up $1.95 at $94.12 and June lean hog are up $1.22 at $107.75.
The projected lean hog index for Dec. 20 is down $0.29 at $80.57, and the actual index for Dec. 19 is up $0.02 at $80.86. Hog prices are lower on the Daily Direct Morning Hog Report, down $0.50 with a weighted average of $79.48, ranging from $76.00 to $80.00 on 2,814 head and a five-day rolling average of $80.10. Pork cutouts total 163.11 loads with 139.24 load of pork cuts and 23.87 loads of trim. Pork cutout values: down $0.63, $82.83.
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