Friday Closing Livestock Market Update - Futures End 2023 in Lackluster Fashion

GENERAL COMMENTS:

From Friday to Friday, livestock futures scored the following changes: December Live cattle up $3.63, February Live cattle off $0.03; January Feeder cattle off $0.45, March Feeder cattle off $1.30; February Lean hogs off $3.38, February Lean hogs off $3.38; February Pork cutout up $0.00, April Pork cutout off $0.00.

Most of the price shifts Friday took place in December live cattle contracts which posted a $2.47 per cwt rally. With spot December contracts expiring during the trading session, traders rolled out of these contract as they settled. The rest of the livestock complex remained lightly traded with price movements mixed in a narrow to moderate trading range, indicating very little direction on the last trading day of the year. The overall sluggish market activity is no shock given that volume has been extremely light all week due to the holiday week, and very little technical or fundamental market direction is seen in the last few days of 2023 trade.

Markets will remain closed until Tuesday morning due to the New Year's Day on Monday. It is expected that more normal market activity will resume early next week as traders adjust from the market shifts seen this week and prepare for more activity during January. Hog prices closed lower on the Daily Direct Afternoon hog report, down $2.79 with a weighted average of $43.57 on 2,217 hogs.

March corn closed down 3 at $4.713 and March soybean meal closed down $4.70 at $386.00. The Dow Jones Industrial Average is down 20.56 at 37,689.54.

LIVE CATTLE:

Live cattle turned sharply higher in the expiring December contract month, pushing spot month prices $2.47 per cwt to $173.67 per cwt. The combination of limited opening interest just before settlement and very thinly traded market activity on the last day of the year added to price volatility in this contract. The rest of the live cattle contracts were quiet with prices hovering within a narrow to moderate, but mixed trading range, indicating very little market direction Friday.

Following a week of very light trade and sluggish market volume, the live cattle complex limped into the end of the year. There is expectations that more volume will be seen early next week once markets come to life, but prices may still be challenged with any sense of short term market direction, as the sideways market trend seen through most of December may carry well into January.

Cash cattle trade are showing a few deals reported in parts of Kansas at $173, $1 higher than yesterday's sales, and $2 higher than last week's weighted averages. Wednesday's business had Southern live deals marked at mostly $172, $1 higher than the prior week's weighted averages, Northern dressed business came in at mostly $272 to $273, $2 to $3 higher than the previous week's weighted average basis Nebraska. Asking prices for cattle left on showlists are around $174-plus in the South, and $274-plus in the North. Having said that, it looks like the bulk of business could essentially be completed for the week, although a little cleanup is not out of the question Friday.

December live cattle closed $2.48 higher at $173.675, February live cattle closed $0.43 lower at $168.5 and April live cattle closed $0.03 lower at $172.25. 

Friday's slaughter is estimated at 125,000 head, 8,000 head more than a week ago and 6,000 head more than a year ago. Estimated Saturday slaughter is 33,000 head moving the weekly slaughter to 508,000 head. 

Boxed beef prices closed mixed: choice down $1.57 ($289.71) and select up $1.09 ($260.33) with a movement of 94.26 loads (65.32 loads of choice, 11.56 loads of select, 5.91 loads of trim and 11.47 loads of ground beef).

TUESDAY'S CATTLE CALL: Steady. Limited activity is expected early next week following the long holiday weekend and shortened procurement week. It is likely that significant bids and asking prices may be moved to midweek or later.

FEEDER CATTLE:

Feeder cattle futures broke away from the wide price swings Friday with nearby contracts stuck in a very narrow but mixed trading range with very limited market movement and essentially no sense of market direction on the last trading day of the year. More active gains moved into deferred contract months, but this support is based more on very limited interest as most traders have already exited the market for the holiday weekend.

More trade activity, volume and general market direction is expected to develop early next week when markets open, but the overall tone of the market is still likely to remain unsettled once market fundamentals are focused on during early January.

January feeders closed $0.18 lower at $222.3, March feeders closed $0.03 lower at $223.1 and April feeders closed $0.03 lower at $228.9. The CME Feeder Cattle Index for Dec. 27: down $1.73, $215.98.

LEAN HOGS:

Lean hog futures moved very little in most contracts Friday as limited activity was seen at the end of the week and last trading day of the year. Spot February futures fell 47 cents per cwt, but the rest of the complex was contained in a narrow range from 15 cents lower to 20 cents lower as traders quickly exited the market ahead of the long holiday weekend and will wait until early next week to sort out any future movement in the market. February lean hogs closed $0.48 lower at $67.975, April lean hogs closed $0.15 lower at $74.85 and May lean hogs closed $0.08 higher at $81.50.

Friday's hog slaughter is estimated at 485,000 head, 53,000 head more than a week ago and 3,000 head less than a year ago. Saturday runs are expected at 319,000 head. Total estimated weekly slaughter, including Saturday's runs are 2.23 million head. Pork Cutouts totaled 294.70 loads with 264.22 loads of pork cuts and 30.48 loads of trim. Pork cutout values are up $2.15 at $84.76. The CME Lean Hog Index for Dec. 27: down $0.14, $65.57.

TUESDAY'S HOG CALL: Steady. Except for a new year to be printed on the checks, not a lot is expected to change early next week. The continued concern of steady to strong supply levels and questions about pork demand will likely leave packers bidding generally steady during another week of short plant runs.

Friday Midday Livestock Market Summary - Mixed Trade as 2023 Comes to a Close

GENERAL COMMENTS:

December live cattle futures are in the spotlight Friday morning with the only livestock contract posting triple-digit gains as traders prepare for contract expiration later Friday. With the exception of December live cattle trading nearly $2.50 per cwt higher the rest of the complex remains mixed within a narrow to moderate range. Trade volume remains extremely sluggish and is expected to continue through the rest of the trading session with most traders content with previous position adjustments, and waiting until the new year before actively stepping back into the market.

The break away from active strong losses in feeder cattle and lean hog trade seen Thursday is a welcome relief, but holiday and end of year market apathy seems to be the focus across the entire market.

March corn is down 2 1/4 at $4.72 and March soybean meal is down $4.20 at $386.5. The Dow Jones Industrial Average is down 120.25 at 37,589.85.

LIVE CATTLE:

Although the overall direction of the entire market is impacted very little due to the limited open interest in spot December contracts, the sharp triple-digit gains in December trade is the focus of the complex. Like said many times through the holiday season already, trade volume remains very light and activity levels sluggish. This has the opportunity for prices to wander in moderate to wide ranges without significant trades being done. Mixed price moves are holding in feeder cattle and lean hog contracts which may keep prices mixed within a narrow to moderate range through most of the session.

With Monday being New Year's Day, trade will remain silent until Tuesday morning as traders prepare to start the 2024 trading year, and likely bring about renewed overall volume and interest.

Cash cattle trade remains undeveloped Friday morning following light trade in most areas Thursday afternoon. Bids have redeveloped at $172 per cwt live basis and $273 dressed basis, although current asking prices are at least $1 per cwt higher than current bids at this point. Trade Thursday developed at $172 live basis, which is $1 higher than last week's average. Dressed trade at $272 to $273 per cwt id generally $2 to $3 per cwt higher than last week's average.

December live cattle are $2.48 higher at $173.675, February live cattle are $0.10 lower at $168.825, April live cattle are $0.15 higher at $172.425. 

Boxed beef prices are mixed: choice down $2.41 ($288.87) and select up $1.20 ($260.44) with a movement of 49.96 loads (32.81 loads of choice, 5.05 loads of select, 4.11 loads of trim and 7.99 loads of ground beef).

FEEDER CATTLE:

Feeder cattle futures are mixed in very limited trade volume with nearby contracts holding light to moderate losses, while increased price levels are seen in late 2024 contract months. The recent market shifts in the complex are partially based on very light volume and this lack of overall market activity in the market is expected to continue until early next week.

January feeders are $0.18 lower at $222.3, March feeders are $0.13 higher at $223.25 and April feeders are $0.23 higher at $229.15.

LEAN HOGS:

Lean hog futures are stuck in a narrowly mixed trading range midday Friday with little to no direction seen across the entire complex. The focus on the long upcoming holiday weekend and previous market pressure in the complex is keeping traders on the sidelines at the end of the week.

February lean hogs are $0.15 lower at $68.3, April lean hogs are $0.03 higher at $75.025 and May lean hogs are $0.03 higher at $81.45. Hog Prices are unreported due to confidentiality on the Daily Direct Morning Hog report. Pork Cutouts totaled 189.89 loads with 174.09 loads of pork cuts and 15.80 loads of trim. Pork cutout values are down $0.44 at $81.28.

Friday Morning Livestock Market Update - Two-Sided Trading Activity May Unfold

GENERAL COMMENTS:

December cattle go off the board Friday and will see limited price movement. It was the only contract which posted a gain Thursday. Other contracts closed lower but the earlier losses were trimmed as cash cattle began trading higher than last week. Packers paid $172 in the South and $172-$173 live in the North with dressed at $273. These are $1 to $3 higher than last week. This should provide some support as more cash sales should take place in line with these prices. The opposite impact could come from further weakness of boxed beef as choice declined $0.20 with select down $1.08. However, stronger cash should provide support as February will take over as the lead month on Tuesday and is carrying a discount to cash. Weekly export sales will be released Friday morning.

Hog futures closed lower Thursday after a brief period in positive territory. Lower lows again may set a negative tone to the market Friday. Cash was higher on the National Daily Direct Afternoon Hog report with a minimal gain of $0.10. Packers were able to procure hogs without much need to bid aggressively. Cutouts were up slightly, posting a gain of $0.09. Hogs have struggled this week but may find some stability as traders position themselves for the final trading day of the year. Saturday slaughter is estimated at 315,000 head as packers try to make up for the downtime last Monday.

	BULL SIDE		BEAR SIDE
1)	Higher cash should provide some support to futures with February taking over as the lead month on Tuesday.	1)	The continued weakness of boxed beef may be an anchor on the potential for continued higher cash.
2)	Cattle futures seem to be building support as they move in a sideways trading range.	2)	Beef inventory has been increasing seasonally over the past three months with November inventory at the highest level since April.
3)	Hog futures may rebound as traders may cover short positions into the end of the year and the extended weekend.	3)	Hog futures may retest the previous lows based on market movement this week and seemingly the overall slower demand.
4)	Strong weekly export sales of pork would provide what is needed to support the market. The weaker U.S. Dollar could increase international interest.	4)	If weekly export sales are less than last week, the market may remain under pressure into 2024.

Thursday Midday Livestock Market Summary - Livestock Futures Slide

GENERAL COMMENTS:

Triple-digit losses are seen in livestock trade midday Thursday morning, although the challenging part of the market moves is that nothing has really changed either fundamentally or technically. Once again, very limited activity in all markets during the holiday week, and what trade did show up this week is more focused on the movements in the stock market which is at or near record highs, leaving little attention to livestock trade. Even cash and meat market movement have very little impact on the direction of futures trade going into the end of the year.

March corn is down 2 at $4.745 and March soybean meal is down $3.30 at $390.5. The Dow Jones Industrial Average is up 54.64 at 37,711.16.

LIVE CATTLE:

Live cattle futures have followed the rest of the complex lower Thursday, although very limited volume at the end of the holiday week is creating more challenges for price levels, as the lack of activity breaks away from the typical normal reason seen in the market as fundamental and technical trade activity take a back seat to a very thinly traded market that can be moved in either direction with very little momentum. Thursday's direction has been lower, and although the potential to adjust positions before the end of the trading day remains, it is becoming more likely that traders will be relatively uninterested in stepping back into the complex over the next couple of hours. Limited trade activity is expected until early next week, when markets reopen after the New Year's break.

Cash cattle activity remains quiet with midweek bids of $270 live basis redeveloping, but still not getting any attention. Asking prices are more available through the morning at $175 and higher live basis in the South and $275 and higher in the North. It is becoming more likely that active trade could be delayed until sometime Friday.

December live cattle are $0.35 lower at $170.375, February live cattle are $0.95 lower at $168.325, April live cattle are $1.18 lower at $171.80. 

Boxed beef prices are lower: choice down $4.85 ($286.63) and select down $0.64 ($259.68) with a movement of 70.34 loads (42.03 loads of choice, 13.02 loads of select, 5.35 loads of trim and 9.94 loads of ground beef).

FEEDER CATTLE:

Feeder cattle futures are leading the market lower as traders have backed away from midweek gains and posting strong morning losses in all contracts. Triple-digit pressure is seen in all contract months at midday, although prices have slowly backed away from session lows of over $2 per cwt, but the tone of the market remains weak with this price pressure likely to hold through the end of the session.

Limited volume is seen across the complex, allowing for markets to move in a more volatile and wide trading range, with little to no fundamental indications at this point. The few trades who are in the market during the holiday week seem more focused on stock prices, which are at or near record highs in most indexes at the end of the year.

January feeders are $1.75 lower at $222.725, March feeders are $1.90 lower at $223.5 and April feeders are $1.80 lower at $229.10.

LEAN HOGS:

Lean hog futures have posted additional losses, following the direction of the rest of the livestock market and most commodity trade Thursday. As mentioned before, the very limited trade volume and light activity during the whole holiday week is adding volatility to the hog complex, and limiting buyer support not only Thursday, but likely through the end of the week.

February lean hogs are $1.73 lower at $68.15, April lean hogs are $1.25 lower at $74.675 and May lean hogs are $1.00 lower at $81.60. Hog Prices are higher on the Daily Direct Morning Hog report, up $1.74 with a weighted average of $47.93, ranging from $47.00 to $48.00 on 1,470 head with a five-day rolling average of $46.62. Pork Cutouts totaled 148.77 loads with 131.71 loads of pork cuts and 17.06 loads of trim. Pork cutout values are down $0.15 at $81.72.

Thursday Morning Livestock Market Update - Traders Wait For Direction From Cash

GENERAL COMMENTS:

December live cattle futures may not change much as the contract goes off the board Friday. The rest of the contracts will be influenced by the development of cash activity. Outside of that, there is limited fundamental reason for the market to change much. Holiday trade may move the market erratically as traders want to make some money but also position themselves for the end of the year to settle their books. No cash activity took place Wednesday as only a few bids were placed and were met with no interest from feedlots. Some activity should surface Thursday, but it likely will be limited. Feeder cattle did much better with the January contract closing at the highest level since Nov. 22. Unfortunately, boxed beef closed lower with choice down $1.83 and select down $0.87.

Hog futures continued to struggle with April and later contracts making lower highs and lower lows. Overall, there is little reason for futures to move higher as cash continues to struggle. Some spread trading took place as traders position their accounts for the end of the year and may want to limit exposure. The National Daily Direct Afternoon Hog report showed cash down $0.29 with the weighted average down to $46.26. Packers have not had to be very aggressive due to a holiday-shortened week with slaughter disrupted. Cutouts may provide a little support Thursday with values up $0.40 on Wednesday. Weekly export sales are delayed until Friday.

	BULL SIDE		BEAR SIDE
1)	A few packers posted bids at steady money with last week but were passed by feedlots as they may hold out for higher cash.	1)	Boxed beef continues to remain lackluster due to reduced demand. It is not likely demand will rebound significantly into the new year.
2)	Strong feeder cattle may provide support to live cattle as traders look for anything to provide volatility and hopefully a profit.	2)	Live cattle futures seem to be in a sideways range where it may remain for a while as supply and demand seem to be somewhat balanced for now.
3)	With the recent weakness of hog futures, there may be short-covering into the end of the year and the extended weekend.	3)	Hog weights decreased slightly last week but remain 6.1 pounds above a year ago at 289.3 pounds.
4)	The weakness of the U.S. dollar could increase international interest for pork along with the low pork prices.	4)	The recent weakness of hog futures may indicate futures may head back down to test the lows again. Cash and cutouts provide limited support.

Wednesday Closing Livestock Market Update - Mixed but Wide Price Movements Seen in Light Holiday Trade

GENERAL COMMENTS:

The focus on light trade activity and limited volume surrounding the holidays sometimes seems to be the most obvious answer for market shifts, however, even though the lack of active market participants does have a significant role in the ability for market prices to break away from fundamental and technical market shifts, the reality of daily market shifts due to this quiet trade does not make the price losses or gains any less real or logical.

Follow-through buying stepped back into the feeder cattle market through the day, although prices shifted in a moderate range during the trading session. With the same information, live cattle futures posted mixed to mostly lower trade with the most aggressive pressure seen in actively traded Live cattle contracts. Hog futures were limited to a much more narrow price shift at closing bell, although prices bounced around through the midweek trading session. Outside markets also played a bigger part in the limited activity in livestock trade as stock prices reached or neared record highs, creating some expectations of what may develop not only through the end of the year, but early 2024 in stock prices, and how this will further impact commodity markets.

Hog prices closed lower on the Daily Direct Afternoon hog report, down $0.29 with a weighted average of $46.26 on 7,347 hogs. March corn closed down 3 3/4 at $4.765 and March soybean meal closed down $2.10 at $393.8. The Dow Jones Industrial Average is up 111.19 at 37,656.52.

LIVE CATTLE:

Live cattle futures traded lower Wednesday with the exception of spot December contracts, which are nearing expiration and even more lightly traded than the rest of the complex during the holiday week. February futures led the complex lower with triple-digit losses, and closed $1.12 per cwt lower by the end of the trading session. Trader interest remains limited with very little long-term direction expected during the holiday week. However, this does not mean that the price shifts are irrelevant at this point, as the midweek market softness continues to allow prices to wander within the moderate sideways market trend seen over the past several weeks. The support during the month of December has pushed current price levels nearly $7 per cwt above long-term support levels, but still dangerously close to market lows following the $30 per cwt loss in the last four months. Traders continue to look for additional longer term market direction from beef demand and outside markets heading into 2024, which may help to bring about increased buyer interest into all contracts.

Cash cattle trade is still at a standstill with a few bids available at $270 dressed basis in Nebraska. Feeders are passing at these at this point, and no other interest is seen in other areas midweek. Asking prices have yet to be well established in any area, and it is expected that trade will be pushed off until sometime Thursday or Friday. Feeders continue to focus on heading into the New Year's weekend with higher prices, but it is still uncertain just how flexible packers will become in moving prices higher before the end of the year.

December live cattle closed $0.15 higher at $170.725, February live cattle closed $1.13 lower at $169.275 and April live cattle closed $0.48 lower at $172.975. 

Wednesday's slaughter is estimated at 125,000 head, 1,000 head more than a week ago and 3,000 head more than a year ago. 

Boxed beef prices closed lower: choice down $1.83 ($291.48) and select down $0.87 ($260.32) with a movement of 106.49 loads (63.80 loads of choice, 24.30 loads of select, 4.93 loads of trim and 13.46 loads of ground beef).

THURSDAY'S CATTLE CALL: Steady to $1 higher. Despite limited bids seen in Nebraska Wednesday, the market remains very quiet. Feeders continue to focus on the expectation of steady to higher prices, which may push trade until late in the week.

FEEDER CATTLE:

Feeder cattle futures shifted higher Wednesday with steady but consistent buyer support moving into the market through most of the trading session. The market remains oversold, and will continue to be in that status for some time, but there is still limited fundamental news available which is likely to create a strong market shift in the near future. This latest move pushed contracts to month-long highs, helping to focus on the potential to draw additional interest back into the market once normal trade volume levels return following the holidays.

January feeders closed $0.93 higher at $224.475, March feeders closed $0.83 higher at $225.4 and April feeders closed $0.83 higher at $230.90. The CME Feeder Cattle Index for Dec. 22: down $0.52, $220.51.

LEAN HOGS:

Lean hog futures regained some market composure during early trade Wednesday, but this initial buyer support was short-lived in most contract months as all but spot February contracts closed lower by the end of the session. Even though February futures were able to retract a portion of Tuesday's losses, gaining 57 cents per cwt, the general lack of interest in buyer support during the holiday week left prices even more vulnerable to end of the week pressure.

Traders are still concerned about the amount of pork available during the first half of 2024, and without any significant shift in domestic or export demand in the coming weeks or months, it appears that prices may continue to wander near the bottom end of the trading range for the short term.

February lean hogs closed $0.58 higher at $69.875, April lean hogs closed $0.15 lower at $75.925 and May lean hogs closed $0.20 lower at $82.60. Wednesday's hog slaughter is estimated at 488,000 head, 3,000 head less than a week ago and 0 head less than a year ago. Pork Cutouts totaled 331.11 loads with 281.98 loads of pork cuts and 49.13 loads of trim. Pork cutout values are up $0.40 at $82.52. The CME Lean Hog Index for Dec.22: down $0.66, $65.59.

THURSDAY'S HOG CALL: Steady. Limited end-of-the week market direction is expected Thursday morning. Packers are preparing for another light procurement weekend with plants dark next Monday for New Year's Day. Midweek softness in cash values is being partially offset by a narrow to moderate boost in pork values, which is likely to lead to cash market stability early Thursday.

Wednesday Midday Livestock Market Summary - Mixed Trade

GENERAL COMMENTS:

Limited overall activity in the livestock market is seen Wednesday morning as traders are still in the middle of the holiday week and on one hand are recovering from the Christmas break, while on the other hand, preparing for New Year's and end of the year positioning.

Overall market participation remains sluggish in all markets, which in many cases leads to some market stability. But the overall lack of active volume in the market can also spark market swings based on a small percentage of normal trade activity in the market on a daily basis. Feeder cattle futures have continued to post moderate gains as traders look for potential firmness in 2024, while the rest of the livestock market is mixed to mostly lower at midday.

March corn is down 4 1/2 at $4.758 and March soybean meal is down $2.90 at $393.00. The Dow Jones Industrial Average is up 64.06 at 37,609.39.

LIVE CATTLE:

Live cattle futures have steadily backed away from early-week gains with mixed trade through most of the morning leading to moderate to firm losses at midday. February contracts continue to be the most actively traded contract in the complex, and is currently leading the market lower with losses over $1 per cwt. The rest of the market is holding moderate to firm losses as light trade through the holiday week is likely to limit renewed buyer support at this point.

December contracts are essentially dead in the water as limited open interest in this contract is dwindling fast with these contracts moving toward expiration quickly. The overall lack of volume in the market could allow for price shifts to continue to be seen through the rest of the session, but it is likely that the technical softness seen during the morning will continue through closing bell as traders adjust positions following Tuesday's active gains.

Cash cattle markets remain generally quiet, although a few bids are seen in Nebraska at $270 per cwt dressed basis. Asking prices are not readily available at this point, but for the time being there is little to no interest in current bids. It is likely that active trade will be delayed another day, and possibly until Friday.

December live cattle are $0.15 lower at $170.425, February live cattle are $1.30 lower at $169.1, April live cattle are $0.75 lower at $172.70. 

Boxed beef prices are mixed: choice down $1.72 ($291.59) and select up $0.13 ($261.32) with a movement of 58.81 loads (35.50 loads of choice, 11.96 loads of select, zero loads of trim and 11.35 loads of ground beef).

FEEDER CATTLE:

Feeder cattle have posted firm follow through buyer support Wednesday morning. The continued movement higher is sparked by limited but supportive technical support trickling into the lightly traded feeder cattle complex. Following ample time to digest last week's cattle on feed and placement reports, the ability to limit fundamental pressure on the feeder cattle complex seems to be easing.

Although it is unlikely that significant short-term changes will quickly develop in any cattle market at this point, the strong market pressure seen over the last three months seems to be softening, giving way to renewed hope of a market recovery through the next year. It is also important to remember that limited trade volume is seen during the holiday week, creating some additional caution to the underlying support seen across the feeder cattle trade over the last couple of days.

January feeders are $0.75 higher at $224.30, March feeders are $0.80 higher at $225.375 and April feeders are $0.68 higher at $230.75.

LEAN HOGS:

Lean hog futures have continued to work lower through the morning, although limited buyer support has seen glimpses as mixed trade has been scattered through the complex at different times through the morning. Narrow gains in spot contracts at midday is an example of this. The rest of the complex remains under light to moderate pressure with prices generally 30 to 50 cents lower at midday. Firm losses Tuesday reiterated traders' disappointment to the news that hog numbers continue to remain stable with last year and have not yet started to decrease. This is likely to continue to impact nearby contract months the most, as overall breeding herd replacements are starting to show a slight decline, but it is uncertain if this will be enough to make a significant change in overall hog numbers and pork supply levels through much of 2024.

February lean hogs closed steady, April lean hogs are $0.55 lower at $75.525 and May lean hogs are $0.33 lower at $82.475. Hog Prices are lower on the Daily Direct Morning Hog report, down $1.90 with a weighted average of $46.19, ranging from $40.00 to $48.00 on 4,420 head with a five-day rolling average of $46.19. Pork Cutouts totaled 159.42 loads with 137.86 loads of pork cuts and 21.56 loads of trim. Pork cutout values are up $1.29 at $81.87.

Wednesday Morning Livestock Market Update - Hogs May See Further Weakness

GENERAL COMMENTS:

Traders had the Cattle on Feed report already factored in, resulting in futures moving to positive prices and closing higher. Gains were moderate, with traders looking ahead to what the cash market will do. This is the first time futures did not fall apart after the report as they did the previous three Cattle on Feed reports. This may provide more confidence for traders to buy into the market for a price retracement. Deferred feeder cattle contracts posted strong gains in anticipation of tighter supplies and higher prices during the second half of the year. Boxed beef closed higher Tuesday with choice up $0.83 and select up $0.04. There has been no cash activity so far and cash trade may follow a similar pattern to last week with activity delayed until late in the week. Feedlots will hold for higher prices as they scored a victory last week and will look for the same, even though it is a holiday week.

Hogs struggled the entire day trading the slightly bearish overall numbers on the Hogs & Pigs report. The pressure pushed futures below technical support, where they closed setting a negative tone for Wednesday. Cash was lower with the National Daily Direct Afternoon Hog report down $1.21 with a weighted average of $46.55. Hogs are struggling to find support. Cutouts showed a minor decline of $0.09. Cutouts are expected to increase as retailers replenish their meat cases. Hog slaughter will be reduced again this week as the upcoming holiday weekend will disrupt schedules.

	BULL SIDE		BEAR SIDE
1)	The Cattle on Feed report had already been factored in with traders looking ahead to cash trade and the potential for better demand.	1)	Beef demand needs to improve before solid support returns to the cattle complex.
2)	Cattle supplies are expected to remain tight throughout much of next year, which should support the overall market.	2)	Packers may not be too anxious this week to purchase cattle aggressively. Slaughter demand is reduced, and packers may pay no more than steady money.
3)	Hog futures may have adjusted to the Hogs & Pigs report, which may limit further downside price movement.	3)	Hog futures closing below technical support may keep further pressure on the market Wednesday as further liquidation may continue.
4)	Deferred hog futures showed minor losses as the report showed a lower number of hogs kept for breeding, which may result in reduced hog numbers later in 2024.	4)	Reduced slaughter again this week may leave packers less aggressive, putting further pressure on cash hog prices.

Tuesday Closing Livestock Market Update - Post-Christmas Support Pushes Cattle Futures Higher

GENERAL COMMENTS:

Limited trade activity is expected through most of the week between the Christmas and New Year's holidays. But that did not stop buyers from stepping back into the cattle complex despite the morning price pressure following the Cattle on Feed report last week. Strong triple-digit gains developed in most live cattle futures and deferred feeder cattle contracts in the last two hours of trade. Hog futures moved in the opposite direction as the cattle market during the Tuesday trading session with strong losses seen in spring 2024 contract months with the concern that still strong supply levels will continue to be a drag on the market and limit overall demand growth through the first half of 2024. Hog prices closed lower on the Daily Direct Afternoon hog report, down $1.21 with a weighted average of $46.55 on 4,640 hogs. March corn closed up 7 1/4 at $4.803 and March soybean meal closed up $4.80 at $395.9. The Dow Jones Industrial Average is up 159.36 at 37,545.33.

LIVE CATTLE:

Live cattle futures traded higher through most of the session, despite initial price uncertainty following the holiday weekend. The overall take of the higher-than-expected cattle on feed numbers in our nation's feedlots was that any bearishness in the market had been factored into market prices over the past couple of weeks, and the outlook for slowing feed numbers in the months to come may help to add even more support to the live cattle complex. By the end of the session actively traded nearby contracts were more than $1 per cwt higher, adding potential support for follow-through gains during the week. Overall volume and market activity is expected to remain extremely light through the entire week, which could add even more volatility to market prices over the next few days, but with prices near support levels, there is more upside market potential than down. Cash cattle trade remains quiet with bids and asking prices undeveloped during the afternoon. Showlists appear mixed, lower in Texas, steady in Kansas, and higher in Nebraska and Colorado. It very well could be late in the week before active cash trade develops. The 5-area weekly average price last week increased $2.14 per cwt from the previous week to $170.85. This move higher ahead of the Christmas holiday is expected to help bring some additional support to this week's cash market direction. December live cattle closed $0.53 higher at $170.575, February live cattle closed $1.88 higher at $170.4 and April live cattle closed $1.33 higher at $173.45. 

Tuesday's slaughter is estimated at 100,000 head -- 25,000 head less than a week ago and 22,000 head less than a year ago. 

Boxed beef prices closed higher: choice up $0.38 ($293.31) and select up $0.04 ($261.19) with a movement of 68.54 loads (42.38 loads of choice, 13.19 loads of select, 7.36 loads of trim and 5.61 loads of ground beef).

WEDNESDAY'S CATTLE CALL: Steady to $1 Higher. Both sides remain quiet following Tuesday, with expectations that sluggish activity will develop through midweek. It very well could be late in the week before active trade develops.

FEEDER CATTLE:

Feeder cattle futures started out under light to moderate pressure Tuesday morning as traders took into account the larger-than-expected placement levels in Friday's Cattle on Feed report. But this market weakness slowly eroded near midday as renewed buyer support and growing support in live cattle futures trade helped rekindle buyer activity. The focus on long-term market direction pushed the most active price gains into late 2024 contract markets, but left all contracts moving in a positive direction through the end of the trading session. Holiday schedules are expected to keep trade volume reduced through most of the week, which could very well add even more volatility to the entire feeder cattle complex. January feeders closed $0.80 higher at $223.55, March feeders closed $0.18 higher at $224.575 and April feeders closed $0.55 higher at $230.075. The CME Feeder Cattle Index for Dec. 21: up $1.22, $221.03.

LEAN HOGS:

Lean hog futures tumbled lower Tuesday as traders continue to be plagued by underlying fundamental support and news that the hog herd has not contracted as expected over the past few months. Even though only narrow reductions were expected in hog numbers in last Friday's Hogs and Pigs report, the fact that overall numbers were slightly higher than year ago levels has impacted market prices and the general direction of the hog complex. February futures led the market lower with a $2.05 per cwt loss, based on the expected number of market-ready hogs in the near future and lack of short-term demand growth. Deferred futures posted much more subdued losses, based on the expectation that breeding herds will be reduced. February lean hogs closed $2.05 lower at $69.3, April lean hogs closed $1.50 lower at $76.075 and May lean hogs closed $1.15 lower at $82.80. Tuesday's hog slaughter is estimated at 463,000 head -- 14,000 head less than a week ago and 16,000 head less than a year ago. Pork Cutouts totaled 298.09 loads with 264.30 loads of pork cuts and 33.79 loads of trim. Pork cutout values are down $0.09 at $82.12. The CME Lean Hog Index for December 21: down $0.44, $66.25.

WEDNESDAY'S HOG CALL: Steady to $1 lower. Continued pressure in futures as well as softness in cash values are likely to limit price gains at midweek. With weekly procurement schedules limited by not only Christmas holiday schedules, but dark plants next Monday due to New Year's Day, limited buying is expected to be needed.

Tuesday Midday Livestock Market Update - Cattle Futures Shift Higher

GENERAL COMMENTS:

Following the long holiday weekend break and last Friday's report frensy for both cattle and hog markets, traders are looking at mixed market direction early in the week. Initial morning trade posted moderate to firm pressure as traders viewed last week's cattle on feed and hogs and pigs reports neutral to slightly bearish, but the underlying softness in the cattle market was overseen by light to moderate buying with the focus that most of this pressure was already factored into market prices last week.

Hog futures have continued to show market weakness through the morning with the most aggressive pressure seen in February and April contracts, trading $1 to $2 per cwt lower through morning trade. Light volume is seen following the Christmas break, and this is expected to continue through the rest of the week with limited market activity typically seen between the Christmas and New Year's holiday each year.

March corn is up 5 1/4 at $4.783 and March soybean meal is up $0.50 at $391.6. The Dow Jones Industrial Average is up 125.12 at 37,511.09.

LIVE CATTLE:

Live cattle futures have led the cattle market higher Tuesday morning following the three-day weekend. February futures are posting the most significant gains at midday or $1.12 per cwt, while the underlying support through the complex remains generally firm despite the limited trade activity. Limited trade direction changes were seen following last Friday's cattle on feed report, which posted overall cattle on feed numbers in December slightly above pre-reported estimates. But the overall market shifts seen last week seemed to have adequately adjusted for these increases, allowing traders to once again focus on the potential of growing demand support through the first two quarters of 2024.

Light volume is expected to be seen through the entire week, which always has the opportunity to bring about moderate to wide price swings with very little fundamental justification. But the ability to create market stability and light to moderate price gains through the end of the year should help bring about additional buyer interest into the entire complex.

Cash cattle activity remains quiet Tuesday morning as packers and feeders have a late start to the week due to the Christmas holiday. The cash price support seen last week should help to bolster asking prices, but it is likely that any significant interest may not be seen until midweek or later.

December live cattle are $0.25 higher at $170.3, February live cattle are $1.13 higher at $169.65, April live cattle are $0.93 higher at $173.05. 

Boxed beef prices are lower: choice down $0.48 ($292.45) and select down $0.45 ($260.70) with a movement of 36.32 loads (21.62 loads of choice, 6.74 loads of select, 4.10 loads of trim and 3.86 loads of ground beef).

FEEDER CATTLE:

Feeder cattle trade started out under pressure Tuesday morning as the lightly traded feeder cattle complex took the brunt of the cattle on feed report news and held light to moderate price pressure through much of the morning. At midday, the softness in the complex has been shaken off with most contracts holding light to moderate gains. Even though placement numbers slid from previous month and year ago levels, the totals still came in higher than expected, which created some uncertainty about current and future supply levels available for the market through the last half of 2024.

Prices may continue to wander in a narrow to moderate range through the rest of the session, with limited trade volume likely to add volatility to the market not only Tuesday, but the rest of the week.

January feeders are $0.28 higher at $223.025, March feeders are $0.25 lower at $224.15 and April feeders are $0.13 higher at $229.65.

LEAN HOGS:

Lean hog futures have moved lower Tuesday morning following the long weekend break and Friday's quarterly hogs and pigs report. Total hog numbers are fractionally changed from year-ago levels, but slightly above pre-report estimates. The expectation by the market that the hog herd has contracted more than it has over the last three months is adding even more concern to market prices, and may limit additional buyer support across the entire complex.

February and April futures are showing the most aggressive pressure, falling $1 to $2 per cwt as traders try to adjust to the current supply levels combined with lackluster growth support in demand and pork prices through the end of the year.

February lean hogs are $2.10 lower at $69.25, April lean hogs are $1.48 lower at $76.1 and May lean hogs are $1.15 lower at $82.80. Hog Prices are unreported due to confidentiality on the Daily Direct Morning Hog report. Pork Cutouts totaled 113.52 loads with 103.22 loads of pork cuts and 10.30 loads of trim. Pork cutout values are down $0.07 at $80.58.

Tuesday Morning Livestock Market Update - Futures May be Under Pressure

GENERAL COMMENTS:

The focus of trade to begin Tuesday will be the Cattle on Feed report. The report was bearish in all categories with the largest estimate being the placement number. This resulted in the fourth consecutive month with higher-than-expected placements. Placements were 98.1% with the trade estimating 92.2%. The on-feed number was 102.7%, slightly higher than expected. Marketings were 92.6%, a bit lower than expected. Futures are expected to open lower but may be offset to some extent by the development of stronger cash at the end of last week. Live cattle in the South traded $1.00 higher with dressed cattle around $3.00 higher. The previous three Cattle on Feed reports put pressure on the market with futures trending lower since the September report. Whether this will be the case again is difficult to say. The market may have already factored this in and may be supported by higher cash. Boxed beef was mixed with choice up $1.80 and select down $0.12. The Commitment of Traders report showed funds reducing their long position by 5,196 contracts, reducing their net-long position to 17,037 contracts. Feeder cattle showed a reduction of 595 contracts, increasing their net-short position to 2,258 futures contracts.

The Hogs & Pigs report was considered neutral to slightly bearish. All hogs and pigs were slightly higher than expected at 100%, along with kept for marketing at 100%. The kept for breeding category was more friendly at 97%, lower than the trade estimate of 98.7%. Futures may see greater support for the deferred contracts. The market will be influenced by cash that may struggle due to the holiday week. Packers may not be aggressive as they need to purchase less. Cash trade Friday was down $0.20, according to the National Direct Afternoon Hog report. Cutouts fared well with a gain of $0.86. The Commitment of Traders report showed funds buying 10,192 futures contracts, reducing their net-short position to 8,238 contracts.

	BULL SIDE		BEAR SIDE
1)	Higher cash cattle last week may provide support to the market with feedlots looking for more this week.	1)	Cattle placements were higher than expected and above expectations for the fourth consecutive month.
2)	The market may have the negative numbers of the Cattle on Feed report already factored in.	2)	Packers may not be aggressive this holiday-shortened week as they will not be running a full slaughter schedule.
3)	Funds reducing their net-short positions as reported in the Commitments of Traders report may provide some support to the hog market.	3)	All categories in the Hogs & Pigs report were higher than the trade estimate, except the kept for breeding category. This may put overall pressure on the market.
4)	The number of hogs kept for breeding, being lower than the trade estimate, may provide support for deferred contracts.	4)	Pigs per litter were at a record high for the third consecutive month. Pigs per litter in September-November increased 3.9% over the previous year.

Friday Closing Livestock Market Update - Cattle On-Feed Numbers Increase 3%

GENERAL COMMENTS:

From Friday to Friday, livestock futures scored the following changes: December Live cattle up $1.83, February Live cattle off $0.82; January Feeder cattle up $1.85, March Feeder cattle up $2.22; February Lean hogs off $0.55, February Lean hogs off $0.55; February Pork cutout up $0.00, April Pork cutout up $0.05.

Pre-holiday and pre-report market shifts developed Friday, allowing for mixed to mostly higher price moves during the Friday session. Nearby live cattle futures posted limited losses, while deferred contracts moved slightly higher. The main support was seen in feeder cattle trade as traders focused on the Friday afternoon report release.

With cattle on feed numbers and placement numbers coming in slightly higher than traders expected in pre-report estimates, it is expected that some uncertainty may continue to develop early next week once markets reopen.

Hog futures bounced higher as traders covered short positions seen earlier in the week, but volume in the hog market also remained extremely light heading into Christmas weekend.

Hog prices closed lower on the Daily Direct Afternoon hog report, down $0.20 with a weighted average of $47.76 on 2,036 hogs. March corn closed up 1/2 at $4.73 and March soybean meal closed up $4.70 at $391.1. The Dow Jones Industrial Average is down 18.38 at 37,385.97.

LIVE CATTLE:

Live cattle futures ended mixed in a narrow trading range Friday afternoon as traders focus on the impact of the cattle on feed report and limited expected trade volume once markets reopen Tuesday.

The cattle on feed report posted larger-than-expected cattle in nations feedlots, creating a generally weaker tone to the market following the report. It is still uncertain just how much of this increase has been factored into prices, as a large portion of the higher supply level has been impacting live cattle prices over the past few weeks. Total cattle numbers in feedlots moved above 12 million head for the first time since April 2022. The fact that cattle on feed numbers continue to grow may be the biggest concern to traders in the coming days.

Cash cattle trade has started to develop through the day Friday. Trade in the south is reported at $171 per cwt live basis, which is $1 per cwt higher than last week's weighted average. Northern trade is seen at $171 to $172 live and $271 per cwt dressed. Dressed trade is $3 per cwt higher than last week. There may be some additional sales trickling in through the early evening, but most of the needed trade seems to have been accomplished.

December live cattle closed $0.50 lower at $170.05, February live cattle closed $0.15 lower at $168.525 and April live cattle closed $0.05 lower at $172.125. 

Friday's slaughter is estimated at 117,000 head, 4,000 head less than a week ago and 21,000 head more than a year ago. Saturday slaughter is estimated at 7,000 head. Week to date slaughter totals are expected at 621,000 head. 

Boxed beef prices closed mixed: choice up $1.80 ($292.93) and select down $0.12 ($261.15) with a movement of 89.97 loads (51.32 loads of choice, 15.27 loads of select, 11.67 loads of trim and 11.71 loads of ground beef).

TUESDAY'S CATTLE CALL: Steady. Limited activity is expected early next week following the Christmas break. Tuesday will likely be focused with show list distribution and inventory taking ahead of another sluggish week and holiday weekend.

FEEDER CATTLE:

Feeder cattle futures posted strong triple-digit gains through early afternoon with buyers focusing on covering short positions ahead of the long holiday weekend and upcoming report. Nearby gains closed $1 per cwt higher with limited volume seen through the entire complex.

The release of the cattle on feed report was only partially positive in the fact that for the first time in three months, placement levels were not above year ago levels. But cattle placements were larger than most expected, falling only 2% from year ago levels, while most expected the decrease to be closer to 4 to 5%. This is expected to have a weakening impact to the market early next week, although the uncertainty lies in the fact that it is still uncertain just how much of the weakness was already put into the market due to caution.

Limited trade is expected all next week between Christmas and New Year's. This could also add increased volatility to the market due to light trade volume.

January feeders closed $1.05 higher at $222.75, March feeders closed $1.03 higher at $224.4 and April feeders closed $1.08 higher at $229.525. The CME Feeder Cattle Index for Dec. 20: up $0.01, $219.81.

LEAN HOGS:

Lean hog futures bounced higher Friday as traders adjusted positions heading into the long holiday weekend and in front of the hogs and pigs report. Even though significant inventory levels were not expected, the fact that overall hog inventory increased slightly instead of decreasing is expected to create a weaker tone to the market once traders return Tuesday following Christmas celebrations.

A moderate reduction in hogs kept for breeding and the expectation that the industry will slowly but steadily work itself out of the heavy supply situation in the next two to three quarters, gives hope for long-term support. However, this may not help support short-term price levels in either the futures or pork markets, especially during the lightly traded holiday season.

February lean hogs closed $0.70 higher at $71.35, April lean hogs closed $0.63 higher at $77.575 and May lean hogs closed $0.40 higher at $83.95. Friday's hog slaughter is estimated at 434,000 head, 34,000 head less than a week ago and 324,000 head more than a year ago. Saturday slaughter is estimated at 61,000 head. Week to date slaughter is estimated at 2.42 million head. Pork Cutouts totaled 318.75 loads with 291.06 loads of pork cuts and 27.69 loads of trim. Pork cutout values are up $0.86 at $82.21. The CME Lean Hog Index for Dec. 20: up $0.15, $66.69.

TUESDAY'S HOG CALL: Steady to $1 lower. A combination of light holiday activity and two back-to-back long holiday weekends, packers are expected to be able to put even more pressure on cash hog values early next week.

Friday Midday Livestock Market Summary - Limited Trade Activity

GENERAL COMMENTS:

Moderate to firm price support is seen in feeder cattle and lean hog futures, each of which are partially focused on covering short positions following the firm pressure seen Thursday in cattle trade, and consistent hog market pressure during the week.

Light volume is the key factor of morning trade Friday, with a portion of traders already exiting the market ahead of the holiday weekend. There is expected to continue to be some limited position adjustments ahead of Friday afternoon's cattle on feed and hogs and pigs report. But for the most part, any needed position shifts have likely already been made.

Following the report, traders will not have access to trade the report information until Tuesday morning, which will give ample time to mull over and second guess potential market direction and main takeaways over Christmas dinner. But for the most part, the rest of the trading day is expected to remain generally calm and uneventful. March corn is down 1/2 at $4.72 and March soybean meal is up $3.30 at $389.70. The Dow Jones Industrial Average is up 64.48 at 37,468.83.

LIVE CATTLE:

Live cattle trade remains generally quiet with prices mixed in a very narrow trading range. Although firm gains have developed in feeder cattle trade during Friday morning, very little follow-through interest has developed in live cattle contracts. Lightly traded and soon to expire December contracts are posting a moderate loss, while other nearby contracts have been able to inch higher, although single-digit gains have been seen through the morning in a couple of nearby contract months.

It appears that traders seem comfortable with current positions in front of Friday's Cattle on Feed report. Pre-report estimates projected a 2.2% increase in on feed numbers from a year ago. This estimate seems to be the tipping point, as an on-feed number above this level will account for a gain from November levels, and the highest on feed numbers since May 2022. But for now at least, traders seem to be generally confident and in consensus that market expectations should represent the report findings.

Cash cattle trade has started to slowly develop in the North with light trade reported at $271 per cwt on a dressed basis. These prices are $3 per cwt higher than last week's weighted average price, and are a welcome sign following the consistent moves lower over the past few weeks. Live trade is not yet developing, but bids are still being passed in all areas at $170 per cwt. Currently asking prices remain at $173 to $175 per cwt live basis and $272 and higher on dressed cattle that have not yet been sold. It very well could be late Friday afternoon and after the 2 p.m. report release before cash cattle trade wraps up heading into the Christmas holiday.

March corn is down 1/2 at $4.72 and March soybean meal is up $3.00 at $389.4. The Dow Jones Industrial Average is up 49.77 at 37,454.12. 

Boxed beef prices are higher: choice up $1.05 ($292.18) and select up $1.63 ($262.90) with a movement of 60.12 loads (39.18 loads of choice, 6.01 loads of select, 8.03 loads of trim and 6.90 loads of ground beef).

FEEDER CATTLE:

Feeder cattle futures have consistently moved higher Friday morning, but midday buyer support has redeveloped across the complex, helping to push feeder cattle trade to triple-digit gains. Although most of the buyer support is focused on short covering following Thursday's market pullback, the underlying support across the complex continues to add increased interest ahead of the afternoon cattle on feed report.

Over the past two months, cattle placement numbers have been the driver behind the prices tumble in feeder cattle and live cattle trade. Although placements will still be a major focus, it appears that most attention will be once again moved back to cattle on feed numbers. Placements are expected to be well under year ago levels due to the strong placement levels seen in October and November.

January feeders are $1.55 higher at $223.25, March feeders are $1.53 higher at $224.9 and April feeders are $1.65 higher at $230.10.

LEAN HOGS:

Lean hog futures are shifting higher Friday morning, although limited trade volume is likely to limit overall trade interest through the rest of the session. Following a firm pullback in prices early in the week, late week short covering and position adjustments are the focus Friday.

Traders are also trying to make any last adjustments to positions in front of both the quarterly hogs and pigs report and the upcoming holiday weekend. Expectations of light hog herd reductions are the majority consensus of the market, although even these inventory and planned pullbacks in numbers are not expected to be viewed overall optimistic as many have hoped overall production would slow faster than what the upcoming report is expected to show.

February futures continue to lead the market higher, with moderate gains seen through the rest of the complex. February lean hogs are $1.15 higher at $71.8, April lean hogs are $0.83 higher at $77.775 and May lean hogs are $0.58 higher at $84.125. Hog Prices are unreported due to confidentiality on the Daily Direct Morning Hog report. Pork Cutouts totaled 213.45 loads with 196.83 loads of pork cuts and 16.62 loads of trim. Pork cutout values are up $0.32 at $80.65.

Friday Morning Livestock Market Update - Limited Volatility Ahead of Reports

GENERAL COMMENTS:

Cattle just could not find sufficient buying interest to support the market Thursday. Steady cash is factored in and looks like it may be a reality. Some trade has developed in Nebraska at $170 live and $270 dressed, while Iowa has seen light trade at $268-$270. It is a bit surprising both sides have been holding without doing business up until the final day of the week and ahead of the holidays. Business may wait until the Cattle of Feed report is released which may not be more beneficial to either side if it comes in near expectations. Cattle on Feed numbers as of Dec. 1 are estimated at 102.2%. Placements in November are estimated at 95.9% with marketings at 93.3%. Traders will continue to position themselves ahead of the report and the three-day weekend, which may result in sideways trade. Boxed beef was mixed with choice up $2.00 and select down $0.33.

More of what we saw Thursday may dominate the trading Friday as traders position themselves ahead of the Quarterly Hogs and Pigs report and the three-day weekend. Some light spreading was done to reduce risk, resulting in February and April closing higher. The National Daily Direct Afternoon Hog report showed a surprising gain of cash. It was only up $0.14, but higher, nevertheless. Cutouts showed a loss of just $0.01 rounding out a noneventful day. The estimates for the report Friday are for all hogs and pigs on Dec. 1 at 99.6%, kept for breeding at 98.7%, and kept for marketing at 99.6%. Saturday slaughter is expected to be light at 53,000 head as some plants will be dark for the weekend.

	BULL SIDE		BEAR SIDE
1)	Cattle futures have a chart gap quite a bit higher than the current market that may be filled at some point.	1)	Cattle futures may be developing a sideways pattern as traders remain uncertain over demand moving into next year.
2)	Steady to higher cash trade should provide support to the market as it will give greater confidence to feedlots to set their sights higher next week.	2)	Cattle placements over the past three Cattle on Feed reports have been higher than expected. Another repeat of this would be negative for prices.
3)	Weekly export sales of 37,500 metric tons (mt) were 33% above the previous week, indicating international demand may be improving.	3)	Hogs may have a difficult time finding long-term support without solid strength from both cash and cutouts.
4)	The Hogs and Pigs report may show higher sow slaughter took place, which could be supportive to the market over time.	4)	Reduced slaughter over the next two weeks may leave packers less aggressive with supply readily available.

Thursday Closing Livestock Market Update - Futures Slide Lower

GENERAL COMMENTS:

Cattle futures have done a complete turnaround from the midweek rally that developed Wednesday. The lack of underlying support and sluggish market interest in all cattle markets continues to add to the price shifts and leaving markets even more unsettled going into the Cattle on Feed report.

Triple-digit losses developed in all cattle contracts with the exception of soon to expire December contracts which posted a 52-cent loss. However, the overall weakness across the complex has done very little to change the overall direction of the market, as light trade and lackluster interest is expected to create additional volatility.

Hog prices closed higher on the Daily Direct Afternoon hog report, up $0.14 with a weighted average of $47.96 on 4,007 hogs. March corn closed up 2 3/4 at $4.725 and March soybean meal closed down $2.30 at $386.4. The Dow Jones Industrial Average is up 322.35 at 37,404.35.

LIVE CATTLE:

Live cattle futures followed feeder cattle trade lower Thursday as traders focused on the overall lack of buyer support that never redeveloped after Wednesday's gains. December contracts posted gains, but the limited volume in this contract is focused more on squaring positions than market discovery, while spring 2024 contracts posted firm triple-digit losses Thursday.

Traders are also starting to adjust positions in front of the Cattle on Feed Report Friday afternoon. The challenge with this report release is that the results will not be able to be traded until Tuesday morning following the Christmas holiday. And even then, very light holiday week trade is likely to limit the overall volume typically seen in a report until the New Year. This could create some additional underlying market swings based on the lack of market participation.

Cash cattle markets are still quiet, although bids continue to be seen over the last couple of days. Live bids in the South are seen at $170 per cwt, with live bids in the North also at $170 per cwt. Dressed bids in the North are holding at $270 per cwt. Asking prices have started to now develop at $173 to $175 live and $272 dressed.

Feeders remain optimistic to focus on steady to higher price levels before the week ends. This could push active trade until sometime Friday, maybe even after the release of the Cattle on Feed report.

December live cattle closed $0.53 higher at $170.55, February live cattle closed $1.63 lower at $168.675 and April live cattle closed $1.65 lower at $172.175. 

Thursday's slaughter is estimated at 125,000 head, steady with a week ago and 3,000 head more than a year ago. 

Boxed beef prices closed mixed: choice up $2.00 ($291.13) and select down $0.33 ($261.27) with a movement of 166.59 loads (113.90 loads of choice, 20.83 loads of select, 13.63 loads of trim and 18.23 loads of ground beef).

FRIDAY'S CATTLE CALL: Steady. Increased bids and asking prices are still developing as the week continues, but uncertainty of market strength is starting to be realized.

FEEDER CATTLE:

Active pressure redeveloped in feeder cattle futures Thursday, with traders backing away from previous gains. Even though little technical or fundamental changes are seen in the complex, the lack of active trade volume is keeping markets very volatile. These market conditions may continue through the holidays as very limited trader activity is expected to be seen in the upcoming days. Traders are also trying to assess and guess the direction of the cattle on feed report when it comes to cattle placement numbers. This may add even more volatility to the market Friday.

January feeders closed $2.35 lower at $221.7, March feeders closed $2.38 lower at $223.375 and April feeders closed $2.08 lower at $228.45. The CME Feeder Cattle Index for Dec. 19: down $0.51, $219.80.

LEAN HOGS:

Lean hog futures continue to post moderate losses in most contracts, although very limited trade developed once again Thursday. Nearby gains developed in both February and April contracts, but the tone of the market remains generally weak. Some additional positioning is likely to be seen Friday in front of the hogs and pigs report, but the upcoming holidays are also limiting overall trade interest and market volume.

February lean hogs closed $0.43 higher at $70.65, April lean hogs closed $0.03 higher at $76.95 and May lean hogs closed $0.18 lower at $83.55. Thursday's hog slaughter is estimated at 490,000 head, 1,000 head more than a week ago and 2,000 head more than a year ago. Pork Cutouts totaled 200.83 loads with 174.21 loads of pork cuts and 26.62 loads of trim. Pork cutout values are down $0.01 at $81.35. The CME Lean Hog Index for Dec. 19: up $0.17, $66.54.

FRIDAY'S HOG CALL: Steady. Limited support in futures trade this week and softness in pork values is likely to limit the ability for active cash market support through the end of the week, especially heading into a long holiday weekend.

Thursday Midday Livestock Market Summary - Livestock Futures Slip Lower

GENERAL COMMENTS:

Moderate price pressure has been seen in most livestock trade through the morning Thursday with increased softness developing as the few traders are actively involved in the market ahead of the holiday weekend.

The lean hog futures continue to erode lower as traders are trying to better pinpoint just where the upcoming hogs and pigs report will position expected short- and long-term pork production levels in the new year. With Friday's reports focusing both on cattle and hog reports, there is uncertainty as to just how much of the expected report findings will already be factored into the market and how much of an impact the reports will have next week.

With the week between Christmas and New Year's typically showing very limited trade volume, the potential that the limited volume could add even more volatility to the post report markets Tuesday morning.

March corn is up 2 1/2 at $4.723 and March soybean meal is down $1.10 at $387.6. The Dow Jones Industrial Average is up 98.39 at 37,180.39.

LIVE CATTLE:

Live cattle futures are trading mostly lower in limited trade volume as traders are adjusting and backing away from previous market support that developed late Wednesday. December is the only contract month holding a gain at midday, but the overall lack of volume and interest in the December contract has little impact on overall direction of the market as a whole. February futures are the most active contract month and is leading the complex lower with an 85-cent loss.

Over the next few days, limited volume and market interest may be the biggest factor affecting the cattle market, potentially allowing prices to make moderate to large price swings on very few trades. Traders are also trying to adjust positions in front of Friday's Cattle on Feed report, which is projected to show a 2.2% increase in on feed numbers from year ago. This estimate seems to be the tipping point, as an on-feed number above this level will account for a gain from November levels, and the highest on feed numbers since May 2022.

Cash cattle trade remains quiet with bids redeveloping in most areas during the morning Thursday. Live bids of $170 and Dressed bids of $270 per cwt are available. Asking prices are holding at $173 to $175 live and $272 per cwt dressed. It would not be out of character if active trade held out until sometime Friday, but some activity may start to develop before the day is over Thursday afternoon.

December live cattle are $0.28 higher at $170.3, February live cattle are $0.83 lower at $169.475, April live cattle are $0.80 lower at $173.025. 

Boxed beef prices are higher: choice up $2.28 ($291.41) and select up $0.70 ($262.30) with a movement of 80.43 loads (44.88 loads of choice, 11.76 loads of select, 8.45 loads of trim and 15.34 loads of ground beef).

FEEDER CATTLE:

Feeder cattle futures are showing the most pressure Thursday morning, with losses of $1 per cwt or higher in nearby contracts. The late-day rally in feeder cattle futures Wednesday following the pullback in stock prices seemed to be overdone, as trades focusing on market corrections ahead of the holiday weekend. Traders are also trying to assess just how proactive they should be in positioning ahead of Friday's cattle on feed report.

Over the last three months, overall cattle placements have been the focus of the report, and also has caused the cattle complex to go into a tailspin following the report. Cattle placements will once again be closely watched, but total on feed numbers may move back into the spotlight for the December report.

January feeders are $1.18 lower at $222.875, March feeders are $1.25 lower at $224.5 and April feeders are $1.18 lower at $229.35.

LEAN HOGS:

Lean hog futures are holding moderate to firm losses in most contracts, although limited gains are trickling into spot February contracts through the morning. May through August contracts are most aggressively being targeted with price pressure as traders continue to still be uncertain as to just how much herd liquidation will develop during 2024. This could limit market support in the near future, especially surrounding the holidays where limited trade volume and sluggish cash market direction will be seen.

Traders are looking for some direction from Friday's quarterly hogs and pigs report, but these numbers may not show significant herd reductions, and could continue to limit underlying market support.

February lean hogs are $0.15 higher at $70.375, April lean hogs are $0.38 lower at $76.55 and May lean hogs are $0.80 lower at $82.925. Hog Prices are unreported due to confidentiality on the Daily Direct Morning Hog report. Pork Cutouts totaled 124.14 loads with 111.82 loads of pork cuts and 12.32 loads of trim. Pork cutout values are down $0.89 at $80.33.

Thursday Morning Livestock Market Update - Cash Cattle Trade Starts to Develop

GENERAL COMMENTS:

Feedlots are holding with some light cash trade at $170 in Nebraska and some dressed at $270. Asking prices are generally $3 to $5 higher at the present time. This certainly will provide support in cattle futures if this continues through the rest of the week. December live cattle futures are reflecting this optimism with a close at $170.02 Wednesday. Be that as it may, traders will be turning some attention to the upcoming Cattle on Feed report Friday which may begin to limit volatility. More caution might develop as the report will be released after the close of trading and ahead of a three-day weekend. Boxed beef prices were mixed with choice up $0.30 with select down $1.56.

Hog futures Wednesday reflected the weakness of cash and cutouts we saw Tuesday with futures posting a lower high and a lower low. Higher cash on Wednesday with the National Daily Direct Afternoon report showing a gain of $0.85 moving the weighted average price to $47.82, might provide some support Thursday. However, cash is expected to be weaker the rest of the week. The better cash Wednesday is expected to be offset by cutouts posting a decline of $1.70. Traders will be cautious over underlying price strength as well as the upcoming Quarterly Hogs and Pigs report. All hogs and pigs on Dec. 1 are estimated at 99.6%, kept for breeding at 98.7%, and kept for marketing at 99.6%. Weekly export sales may have an influence on trade direction Thursday.

	BULL SIDE		BEAR SIDE
1)	Packers have raised bids to steady with last week and may need to increase those bids as feedlots are holding offers at $3 to $5 higher.	1)	If cash cattle trade steady this week, the futures already have that factored in, limiting further upside.
2)	There may be further short-covering heading into the Cattle on Feed report and the three-day weekend.	2)	Weekly export sales need to be better than last week or cattle futures could see some weakness with the ongoing concern of demand.
3)	Higher cash hogs Wednesday may provide some stability in futures Thursday balanced with the loss in cutouts.	3)	Pork demand continues to remain weak, which is reflected by struggling cash and cutouts. This will limit upside price potential.
4)	Positioning ahead of the Hogs and Pigs report may result in some short-covering and a rebound in futures.	4)	Weekly hog weights were 0.9 pounds below the previous week but remain 4.3 pounds above a year ago.

Wednesday Closing Livestock Market Update - Cattle Futures Rally in Late-Day Trade

GENERAL COMMENTS:

Strong late-day support developed through all cattle futures Wednesday afternoon. The sluggish market shifts seen early in the session in both live cattle and feeder cattle trade created limited market support and mixed price moves at midday. However, unlike the previous trading days where prices quickly eroded in the last hour of trade, Wednesday's market shifts helped to bring some additional momentum to the complex.

Hog futures remained under light to moderate pressure with traders still concerned that current production trends may not be quickly changing and could further oversupply demand through early 2024. Hog prices closed higher on the Daily Direct Afternoon hog report, up $0.85 with a weighted average of $47.82 on 3,279 hogs.

March corn closed down 3 at $4.698 and January soybean meal closed down $3.30 at $399.9. The Dow Jones Industrial Average is down 475.92 at 37,082.00.

LIVE CATTLE:

Live cattle futures moved above the $170 per cwt level for the first time in December as active buyer interest moved back into the complex during the last hour of trade. Although volume remains sluggish heading into the Christmas holiday week, the focus on increased underlying support in feeder cattle markets became the main driver once again for the renewed late day price surge. Deferred contracts closed higher but lacked the aggressive market support seen in nearby contracts.

Traders will remain cautiously optimistic heading into the last half of the week and the holiday weekend.

Cash cattle markets remain untraded for the most part, although bids are starting to become much more evident Wednesday afternoon. Live bids in the South are seen at $170 per cwt, with live bids in the North hovering around $168 to $170 per cwt. Dressed bids in the North are holding at $270 per cwt. Asking prices have started to now develop at $173 to $175 live. December live cattle closed $1.58 higher at $170.025, February live cattle closed $1.53 higher at $170.3 and April live cattle closed $1.15 higher at $173.825. 

Wednesday's slaughter is estimated at 123,000 head, 4,000 head less than a week ago and 1,000 head less than a year ago. 

Boxed beef prices closed mixed: choice up $0.30 ($289.13) and select down $1.56 ($261.6) with a movement of 123.67 loads (75.84 loads of choice, 19.91 loads of select, 5.50 loads of trim and 22.42 loads of ground beef).

THURSDAY'S CATTLE CALL: Steady. Increased bids and asking prices are starting to be seen Wednesday afternoon, although there remains a wide gap between feeders and packers at this point.

FEEDER CATTLE:

Feeder cattle futures rallied higher late Wednesday with all contracts posting gains over $2 per cwt. The softness over the last couple of days focusing on uncertainty in overall feeder cattle supplies seemed to lose its momentum in late day trade with active buyer support sweeping through the complex. The market remains generally oversold, but the combination of light volume through the end of the year and positioning in front of the cattle on feed report is helping to draw increased support to the entire market complex.

January feeders closed $2.15 higher at $224.05, March feeders closed $2.55 higher at $225.75 and April feeders closed $2.65 higher at $230.525. The CME Feeder Cattle Index for Dec. 18: up $0.40, $220.31.

LEAN HOGS:

Lean hog futures ended the session with another round of market losses as buyers are hard to find through the week, allowing prices to back away from last week's gains. The concern that pork production may remain strong through the first half of 2024 has continued to keep buyers at bay.

Continued softness in cash hog values and pork prices has also limited any sense of market support in nearby and deferred contract months. Traders are looking for some additional direction from the upcoming hogs and pigs report Friday, but generally this report shows limited market direction given the scope of the report and typical narrow production adjustments that are reported in these reports.

February lean hogs closed $0.33 lower at $70.225, April lean hogs closed $0.68 lower at $76.925 and May lean hogs closed $0.63 lower at $83.725. Wednesday's hog slaughter is estimated at 490,000 head, 1,000 head more than a week ago and 0 head less than a year ago. Pork Cutouts totaled 285.32 loads with 256.63 loads of pork cuts and 28.69 loads of trim. Pork cutout values are down $1.70 at $81.36. The CME Lean Hog Index for Dec. 18: down $0.22, $66.37.

THURSDAY'S HOG CALL: Steady. Limited support in futures trade this week and softness in pork values is likely to limit the ability for active cash market support through the end of the week, especially heading into a long holiday weekend.