GENERAL COMMENTS:
It was a mostly supportive day for the cattle complex as most of the contracts rounded out the day on a higher note. The nearby lean hog contracts struggled but the deferred contracts were able to close mildly higher. Hog prices closed $5.51 lower on the Daily Direct Afternoon Hog Report, equating to a weighted average of $81.41 on 3,119 head. December corn is down 9 1/2 cents per bushel and December soybean meal is down $6.90. The Dow Jones Industrial Average is up 270.85 points.
LIVE CATTLE:
The live cattle complex completed another day with the contracts mostly able to say that they closed higher. The market was slow and lackluster throughout the day as traders patiently wait to see what develops in the cash market and hope to see boxed beef prices improve later this week. October live cattle closed $0.07 lower at $181.47, December live cattle closed $0.22 higher at $185.87 and February live cattle closed $0.17 lower at $189.77. Still no bids nor asking prices are available and, while the market could see asking prices listed Wednesday, it's likely that business is delayed until Thursday or Friday.
Tuesday's slaughter is estimated at 125,000 head, 1,000 head more than a week ago and 2,000 head more than a year ago.
Boxed beef prices closed lower: choice down $2.68 ($314.36) and select down $2.41 ($289.68) with a movement of 107 loads (58.13 loads of choice, 19.79 loads of select, 16.22 loads of trim and 12.62 loads of ground beef).
WEDNESDAY'S CATTLE CALL: Steady. Given that showlists are current and that packers didn't get a plethora of cattle bought last week, it's likely that prices remain at least steady this week.
FEEDER CATTLE:
Traders were running through Tuesday's market modestly supporting the feeder cattle complex even though prices soared through Monday's end. It helped that corn prices continued to trade lower throughout the day, and just the spot September and October 2023 contracts closed lower while the rest of the market added mildly to Monday's close. Buyer interest has been strong this week throughout the countryside, which is encouraging to traders after they made such an aggressive move early in the week. As trade continues throughout the week, the feeder cattle complex will continue to monitor corn prices and hopes to see at least steady trade in the cash cattle market. September feeders closed $0.25 lower at $254.02, October feeders closed $0.27 lower at $256.75 and November feeders closed $0.07 higher at $258.12. At Joplin Regional Stockyards in Carthage, Missouri compared to last week feeder steers under 625 pounds sold $13.00 to $20.00 higher with heavier weights selling steady to $3.00 higher. Feeder heifers sold $8.00 to $16.00 higher. The auction report noted that the heat index on sale was 25 degrees lower, which helped drive the market. Feeder cattle supply over 600 pounds was 55%. The CME Feeder Cattle Index for Aug. 28: up $1.29, $249.12.
LEAN HOGS:
The lean hog complex didn't see much improvement throughout Tuesday's afternoon as the nearby contracts remained weaker while the deferred contracts were able to close slightly higher. Trader would have liked to pressure the resistance in the spot October contract at $82.00, but with both cash prices and pork cutout values closing lower, the fundamental support necessary to break past that threshold didn't solidify throughout Tuesday's hours. It's likely that the afternoon's carcass price would have closed higher if it weren't for the $26.50 drop in the belly Tuesday afternoon. The belly continues to be an extremely volatile cut and unfortunately, that's not likely to change in the near futures. October lean hogs closed $1.12 lower at $80.72, December lean hogs closed $0.60 lower at $72.82 and February lean hogs closed $0.45 lower at $77.00.
Pork cutouts totaled 306.83 loads with 272.28 loads of pork cuts and 34.56 loads of trim. Pork cutout values: down $3.20, $92.85. Tuesday's slaughter is estimated at 470,000 head, 6,000 head less than a week ago and 10,000 head less than a year ago. The CME Lean Hog Index for Aug. 25: down $1.29, $93.89.
WEDNESDAY'S HOG CALL: Steady. Packers will likely need to accumulate more hogs at some point this week, but I doubt that they do so in a manner that drives cash prices much higher.
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