GENERAL COMMENTS:
The surprising onset of higher corn prices are causing most of the livestock contracts to trade lower into Tuesday's noon hour. The live cattle complex is the only market enduring the news somewhat well, but with the added combination of lower boxed beef prices at midday, the market will need to see something positive ahead of Tuesday afternoon's end. March corn is up 8 1/2 cents per bushel and March soybean meal is up $2.20. The Dow Jones Industrial Average is up 13.29 points.
LIVE CATTLE:
The live cattle market is mostly keeping with its upward trend even though corn prices are gaining momentum heading into Tuesday's afternoon and that midday boxed beef prices are lower. February live cattle are down $0.10 at $157.65, April live cattle are up $0.05 at $161.57 and June live cattle are steady at $157.45. If the corn complex keeps its stronger front through most of the day, then it's likely that all the live cattle contracts close lower as a $0.08 to $0.10 rally in the nearby corn contracts is newsworthy. How the rest of the week trades will largely be determined on how boxed beef prices perform throughout the remainder of the week, and the slight dip in prices come Tuesday shouldn't rattle the cash cattle market's momentum. With fat cattle being at the end of the rope and requiring very few more days on feed, one would logically think that corn prices shouldn't affect the live cattle complex all that much, but unfortunately that isn't the case. Asking prices in the South are noted at $158 to $159 but are still unestablished in the North. Trade won't likely develop until Thursday or Friday.
Boxed beef prices are lower: choice down $0.96 ($285.18) and select down $0.50 ($259.10) with a movement of 70 loads (47.07 loads of choice, 9.40 loads of select, zero loads of trim and 13.90 loads of ground beef).
FEEDER CATTLE:
Tuesday's market has been fickle for the feeder cattle complex to navigate as corn prices have shot higher, and the strength that the market was relying on from the live cattle complex seems a little hazy at this point. More than anything, the feeder cattle contracts are being pushed lower as nearby corn contracts rally $0.08 to $0.10 higher into Tuesday's afternoon. Last week's $0.24 to $0.25 regression in the March 2023 and May 2023 corn contracts was exhilarating for feeders as any reduction in input prices helps feeders' bottom line -- and especially when feeder cattle prices are as high as they are. Time will tell how the slight jolt in corn prices affect feeder cattle sales, but so long as the rally doesn't get much more aggressive, sales should remain strong as it's equally as noteworthy that there simply aren't as many feeders to be had in this year's market, which will push some buyers into paying whatever necessary to keep their pens full.
LEAN HOGS:
It's another day, another week, another Tuesday, and yet here we find ourselves again looking at the lean hog market trading lower into Tuesday's afternoon. The lean hog market has enough hurdles to manage on its own -- let alone having it face higher corn prices. Unfortunately, the midday increase in pork cutout values doesn't mean much, and traders won't see the $0.93 increase as relevant bullish support unless the day's afternoon cutout value closes higher and consistently for a few days. February lean hogs are down $1.30 at $79.50, April lean hogs are down $1.10 at $89.70 and June lean hogs are down $1.05 at $105.40.
The projected lean hog index for Jan. 9 is down $0.35 at $76.44, and the actual index for Jan. 6 is down $0.70 at $76.79. Hog prices are lower on the Daily Direct Morning Hog Report, down $1.64 with a weighted average of $72.23, ranging from $70.00 to $75.00 on 3,586 head and a five-day rolling average of $73.59. Pork cutouts total 206.88 loads with 187.24 loads of pork cuts and 19.64 loads of trim. Pork cutout values: up $0.93, $83.28.
No comments:
Post a Comment