GENERAL COMMENTS
It was a brutal day for the livestock complex as the market faced immense pressure from outside factors and stood no chance at trading higher given the stiff down pressure that loomed over the marketplace. Friday will be a busy day with the week's export data released first thing, and cattlemen anxious to see the afternoon's latest Cattle on Feed report. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.86 with a weighted average of $70.35 on 9,829 head. March corn is down 4 cents per bushel and March soybean meal is down $6.90. The Dow Jones Industrial Average is down 250.01 points.
LIVE CATTLE:
It was a bitter day for the live cattle complex as not only did the live cattle contracts face the same pressure that the rest of the livestock market did, but the cash cattle market also traded a light volume of cattle in the North for cheaper money. The spot April contract traded between the 40-day and 100-day moving averages and saw the biggest regression out of all the live cattle contracts for the day. February live cattle closed $0.85 lower at $155.95, April live cattle closed $1.10 lower at $159.12 and June live cattle closed $0.87 lower at $156.00. This sharp regression in prices will likely invite some traders back into the market, but that may not happen until Monday, as traders could still be cautious able to the complex on Friday. A light trade was reported in the North at $248, which is $2.00 to $3.00 lower than last week's weighted average.
A few cattle sold in the South for $155, which is $1.00 lower than last week's weighted average.
Thursday's slaughter is estimated at 120,000 head, 2,000 head less than a week ago but 3,000 head more than a year ago.
Thursday's actual slaughter data shared that, for the week ending Jan. 7, steers averaged 919 pounds, which is 4 pounds heavier than the previous week but 9 pounds lighter than the same week a year ago. For the same week heifers averaged 831 pounds, which is 8 pounds less than the previous week and 24 pounds lighter than a year ago.
Boxed beef prices closed mixed: choice down $2.57 ($271.51) and select up $1.83 ($255.69) with a movement of 130 loads (92.99 loads of choice, 12.51 loads of select, 3.82 loads of trim and 20.54 loads of ground beef). The choice/select spread sits at $15.82.
FRIDAY'S CATTLE CALL: Steady with the week's trend. Given that cattle have sold in both regions, prices will likely remain steady with the week.
FEEDER CATTLE:
The spot March feeder cattle contract sank to prices not last seen since November 2022 as the market couldn't find any footing in Thursday's hours. The corn market isn't to blame for feeders' weakness as it too closed lower, but instead the feeder cattle complex came under pressure from outside forces like the rest of the livestock contracts and stood merely no chance at closing higher. Friday's Cattle on Feed report could be positive for the market as placements are expected to be sharply lower than a year ago, but unfortunately traders won't be able to trade its content until Monday. January feeders closed $1.40 lower at $178.10, March feeders closed $1.62 lower at $180.10 and April feeders closed $1.15 lower at $185.15. At Winter Livestock Auction in Pratt, Kansas, compared to last week, steers and heifers weighing 400 to 900 pounds traded $3.00 to $6.00 lower on lighter receipts. Slaughter cows traded $5.00 higher and slaughter bulls sold $2.00 lower. Feeder cattle supply over 600 pounds was 64%. The CME Feeder Cattle Index for Jan. 18: down $1.22, $177.87.
LEAN HOGS:
The lean hog complex had to face the same technical pressure that the rest of the livestock contracts did, but let's not let that overshadow the afternoon pork cutout report. Not only did the market move 467.30 loads of product, but it the carcass value also ended the day on a higher note. The biggest reason why the carcass was able to close higher was because ham prices jumped $7.98, but the butt also gained $0.55. This makes for a higher pork cutout value for two consecutive days in a row. February lean hogs closed $0.67 lower at $76.65, April lean hogs closed $1.80 lower at $84.40 and June lean hogs closed $1.15 lower at $102.25. Pork cutouts totaled 467.30 loads with 431.23 loads of pork cuts and 36.07 loads of trim. Pork cutout values: up $1.68, $79.57. Thursday's slaughter is estimated at 448,000 head, 40,000 head less than a week ago and 9,000 head less than a year ago. Wednesday's hog slaughter was revised to 481,000 head. The CME Lean Hog Index for Jan. 17: down $0.33, $73.85.
FRIDAY'S HOG CALL: Lower. Packers don't normally show much interest in the cash hog market on Fridays and it's unlikely they'll do so this week.
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