GENERAL COMMENTS
The livestock complex closed fully lower without much interest from traders allowing the contracts to do anything else. Traders seem to be cautiously waiting for the week's cash cattle market to trade, as well as to see what Thursday's WASDE report holds before moving the contracts in either direction much more. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.32 with a weighted average of $72.99 on 7,178 head. March corn is up 1 cent per bushel and March soybean meal is up $5.70. The Dow Jones Industrial Average is up 268.91 points.
LIVE CATTLE:
It was a quiet day throughout the live cattle sector as the market continues to wait for the cash complex to trade cattle, but until packers offer reasonable bids, feedlots aren't in any hurry to trade. The live cattle contracts closed steady to 32 points lower as the market simply lacked much action throughout the day. Come Thursday, more bids are expected to develop in the cash sector, and Thursday's WASDE report should help cultivate some interest in the complex. There were a handful of cattle traded in Nebraska, but there weren't enough cattle traded to say any sort of trend has been established for the week. Asking prices in the South are noted at $158 to $159 and are still unnoted in the North. Trade could begin to develop on Thursday, but it's equally as likely that trade holds off until Friday to develop too. February live cattle closed steady at $157.57, April live cattle closed $0.32 lower at $161.32 and June live cattle closed $0.17 lower at $17.32.
Wednesday's slaughter is estimated at 127,000 head, 2,000 head more than a week ago and 13,000 head more than a year ago.
Boxed beef prices are lower: choice down $3.80 ($280.73) and select down $0.23 ($258.10) with a movement of 116 loads (67.84 loads of choice, 16.75 loads of select, 11.97 loads of trim and 19.88 loads of ground beef). The choice/select spread sits at $22.63.
THURSDAY'S CATTLE CALL: Steady to $1.00 higher. Feedlots will likely push this week's cash market higher, or at least keep prices steady.
FEEDER CATTLE:
The feeder cattle contracts closed slightly lower as the market danced around the onset of slightly higher corn prices and longed for support from the live cattle/cash cattle market that never came. January feeders closed $1.17 lower at $183.12, March feeders closed $0.95 lower at $185.55 and April feeders closed $0.95 lower at $189.57. While the feeder cattle contracts may have closed slightly lower, demand throughout the countryside was still extremely strong for both feeders and calves. It's likely that the feeder cattle complex turns higher later this week if buyer demand holds strong in sale barns and if cash cattle do indeed to trade -- both of which would help the market's morale and assure traders that fundamental strength is still intact. At Winter Livestock Auction in La Junta, Colorado, compared to last week, steers calves traded $10.00 to $15.00 higher, and heifer calves traded $5.00 to $8.00 higher. Feeder steers over 700 pounds traded steady to $2.00 higher and feeder heifers over 700 pounds traded mostly steady. Slaughter cows traded steady to $2.00 lower, and slaughter bulls traded steady. Feeder cattle supply over 600 pounds was 66%. The CME Feeder Cattle Index for Jan. 10: up $1.34, $182.32.
LEAN HOGS:
The lean hog complex continued to trade lower throughout Wednesday's market as the sector received no fundamental support and traders are in desperate need of something positive if they're to trade this market any direction other than lower. Demand continues to be the unsettling factor of the lean hog market as pork cutout prices continue to dwindle and consequently that's kept packers at bay from supporting the cash market. Hopefully Thursday's WASDE report will give some insight into what the market can expect for demand in the months ahead. February lean hogs closed $0.50 lower at $79.30, April lean hogs closed $1.12 lower at $88.40 and June lean hogs closed $1.05 lower at $104.25. Pork cutouts totaled 392.37 loads with 348.26 loads of pork cuts and 44.11 loads of trim. Pork cutout values: down $1.05, $80.68. Wednesday's slaughter is estimated at 490,000 head, 15,000 head more than a week ago and 59,000 head more than a year ago. Tuesday's hog slaughter was revised to 458,000 head. The CME Lean Hog Index for Jan. 9: down $0.35, $76.44.
THURSDAY'S HOG CALL: Lower. Given that pork cutout values are still depressed, it's unlikely that the cash hog market will see enough interest to drive prices higher.
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