GENERAL COMMENTS:
The live cattle complex charged higher while both the lean hog and feeder cattle markets faced some pressure. The big question heading into Thursday's market will again be: what are cash cattle prices doing to amount to? Hog prices closed higher on the daily Direct Afternoon Hog Report, up $0.23 with a weighted average price of $104.48 on 15,292 head. December corn is up 18 1/2 cents per bushel and December soybean meal is down $1.30. The Dow Jones Industrial Average is up 109.01 points.
LIVE CATTLE:
The live cattle complex continues to grind higher as traders anxiously wait to see what will be revealed in Friday's USDA reports as well as waiting to see what develops in this week's cash market. A sole bid of $291 dressed was offered by a regional packer in Eastern Nebraska, but feedlots let that offer sit idle as they hold firm to their asking price of $295 dressed in the North and $183-plus in the South. Packers are playing a tough game of ball as they reduce slaughter speeds to try to manage the amount of cattle they need from the cash market, but still, with having bought less than 70,000 head in last week's cash market, they're going to need to buy cattle this week to keep from becoming short bought. August live cattle closed $0.05 higher at $181.32, October live cattle closed $0.17 higher at $183.72 and December live cattle closed $0.02 higher at $187.02.
Wednesday's slaughter is estimated at 122,000 head, 5,000 head less than a week ago and 3,000 head less than a year ago.
Boxed beef prices closed lower: choice down $1.09 ($303.59) and select down $0.65 ($275.96) with a movement of 123 loads (69.84 loads of choice, 30.17 loads of select, 9.07 loads of trim and 14.27 loads of trim).
THURSDAY'S CATTLE CALL: Higher. At this point, prices are likely to trade higher as feedlots remain firm in getting at least steady prices as they haven't weakened and sold a plethora of cattle yet.
FEEDER CATTLE:
The feeder cattle complex wasn't able to join the live cattle and lean hog markets in closing higher as the $0.16 to $0.18 jump in corn prices kept its market hobbled. August feeders closed $1.20 lower at $246.80, September feeders closed $0.67 lower at $249.32 and October feeders closed $0.52 lower at $250.55. At this point, the feeder cattle complex is just balancing the signals from both the live cattle/cash cattle market, corn market and demand from buyers. But as feedlots again have to go rounds with packers this week, the biggest determining factor in Wednesday's market was the increase in corn prices as no substantial cash cattle trade developed and lent support to feeders. The CME Feeder Cattle Index for July 18: up $0.03, $238.48.
LEAN HOGS:
The lean hog complex was able to close mixed, with its late 2023/early 2024 contracts closing lower while the deferred and spot contracts closed mostly higher. The big question for the near future is: what will demand amount to? Big price swings have been evident in pork cutout values as of late, and it's tough saying when that seesaw nature will subside. August lean hogs closed $1.65 higher at $97.92, October lean hogs closed $0.25 higher at $81.72 and December lean hogs closed $0.25 lower at $74.95. Wednesday's slaughter is estimated at 468,000 head, 16,000 head more than a week ago and 7,000 head more than a year ago. Tuesday's slaughter was revised to 460,000 head. Pork cutouts totaled 288.41 loads with 266.61 loads of pork cuts and 21.81 loads of trim. Pork cutout values: down $0.07, $112.61. The CME Lean Hog Index for July 17: up $0.93, $102.53
THURSDAY'S HOG CALL: Steady to somewhat lower. Given that packers have bought somewhat aggressively over the last two days likely indicates that they'll be less aggressive in the later half of the week.
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