GENERAL COMMENTS:
The livestock complex struggled with the corn market's slight uptick as both the feeder cattle and lean hog contracts closed lower, but the live cattle complex was able to keep a mildly higher position through closing. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $1.33 with a weighted average price of $88.42 on 6,410 head and a five-day rolling average of $90.23. December corn is up 11 cents per bushel and December soybean meal is up $6.00. The Dow Jones Industrial Average is up 184.15 points.
Wednesday's Cold Storage Report shared that total red meat supplies in freezers were down slightly from the previous month and down 14% from a year ago. Total pounds of beef in freezers were up 2% from last month but down 18% from a year ago. Frozen pork supplies were down 3% from last month and down 10% from a year ago. Stocks of pork bellies were down 26% from last month but up 21% from last year.
LIVE CATTLE:
The live cattle complex closed mostly higher with just the December 2023 and February 2024 contracts closing slightly lower. Traders are appreciating the support in boxed beef prices, although they know that prices could be pressured again in the next couple of weeks before holiday buying begins. It's also encouraging that feedlots are holding out for at least steady prices as still no cattle have traded, and feedlots have turned down bids. A single bid of $290 was offered throughout the day in Nebraska, but feedlots didn't jump at its showing. October live cattle closed $0.05 higher at $178.67, December live cattle closed $0.22 lower at $182.92 and February live cattle closed $0.10 lower at $187.20.
Wednesday's slaughter is estimated at 118,000 head, 5,000 head less than a week ago and 6,000 head less than a year ago.
Boxed beef prices closed higher: choice steady ($317.05) and select up $2.08 ($291.59) with a movement of 109 loads (64.51 loads of choice, 33.04 loads of select, zero loads of trim and 11.68 loads of ground beef).
THURSDAY'S CATTLE CALL: Steady. Packers are going to fight "guns blazing" to work prices lower, but feedlots also want to keep prices as close to steady as possible, so, once again, this week's trade is a gamble of wills between packers and feedlots.
FEEDER CATTLE:
The feeder cattle complex tried to keep its momentum through Wednesday's closing, but, with corn prices closing $0.09 to $0.11 higher, traders instead waived their white flag and let the contracts close lower. September feeders closed $0.42 lower at $248.57, October feeders closed $0.35 lower at $250.87 and November feeders closed $0.27 lower at $252.00. At Huss Livestock Market in Kearney, Nebraska, compared to the last sale two weeks ago, steers weighing 950 pounds and over sold $2.00 higher. Demand was moderate to good from the buyers in the crowd. Feeder cattle supply over 600 pounds was 97%. The CME Feeder Cattle Index for Aug. 22: down $0.21, $244.75.
LEAN HOGS:
The lean hog complex sank lower yet again through Wednesday's end as traders noted the uptick in corn prices and the continued pressured in pork cutout values. October lean hogs closed $1.02 lower at $78.55, December lean hogs closed $1.30 lower at $71.05 and February lean hogs closed $1.17 at $75.37. Thursday's market will be interesting to watch because traders are at the bottom side of this trading range and if pressure continues through Thursday's market, they'll have to decide if they're going to break through this support plane or chop the market sideways. If the belly wouldn't have had a $17.19 drop, the cutout value may have been able to close slightly higher as the butt gained $3.17 and the rib closed $2.51 higher. Pork cutouts totaled 298.96 loads with 264.41 loads of pork cuts and 34.55 loads of trim. Pork cutout values: down $2.86, $100.79. Wednesday's slaughter is estimated at 473,000 head, 2,000 head more than a week ago and 9,000 head less than a year ago. The CME Lean Hog Index for Aug. 21: down $0.77, $98.04.
THURSDAY'S HOG CALL: Steady. Packers showed Wednesday's market a little more support but, with cutout values being mostly pressured, I tend to believe that prices will remain steady.
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