GENERAL COMMENTS:
The lean hog market saw good support through Wednesday's close, but both the live cattle and feeder cattle contracts closed lower. Heading into Thursday's market, traders are hopeful that some positive new will shine from the cash cattle market and comfort them that steady/slightly higher trade is merited. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.86 with a weighted average price of $80.55 on 6,912 head. December corn is down 6 cents per bushel and December soybean meal is down $1.70. The Dow Jones Industrial Average is up 37.57 points.
LIVE CATTLE:
The live cattle complex kept with its lackluster tone through Wednesday's end as traders were simply unwilling to support the contracts unless something supportive developed fundamentally. Boxed beef prices were able to round out the day mixed with choice cuts again seeing a little more support, but still no sizeable trade has developed in the cash cattle market. Throughout the day there was a bid of $290 offered in Nebraska, but feedlots let it grow cold as that's below their asking price. Southern feedlots are asking $181 to $182, and Northern feedlots are asking $292 to $294. The cash cattle market will likely see better interest come Thursday especially, because last week's trade was relatively light. October live cattle closed $1.42 lower at $180.05, December live cattle closed $1.65 lower at $184.22 and February live cattle closed $1.42 lower at $188.35.
Wednesday's slaughter is estimated at 125,000 head, 7,000 head more than a week ago and 2,000 head less than a year ago.
Boxed beef prices closed mixed: choice up $0.75 ($315.11) and select down $0.15 ($289.53) with a movement of 107 loads (69.98 loads of choice, 24.52 loads of select, zero loads of trim and 12.69 loads of ground beef).
THURSDAY'S CATTLE CALL: Steady. With packers unable to get many cattle bought last week and very few committed with time, it's likely that they have to support this week's market more than they'd like, which could keep prices steady.
FEEDER CATTLE:
Try as it might, the feeder cattle complex ran out of steam Wednesday afternoon as traders continue to look for more fundamental support before they'll confidently advance the contracts again. The live cattle/cash cattle markets didn't lend much support either as the live cattle contracts closed lower and as still no substantial cash cattle trade has developed. Corn prices continue to trade lower, but at this point, traders need motivating support, not just reassurance from the grain sector. September feeders closed $1.40 lower at $252.62, October feeders closed $1.52 lower at $255.22 and November feeders closed $1.40 lower at $256.72. At Winter Livestock Auction in Dodge City, Kansas, compared to last week, feeder steers weighing 700 to 850 pounds sold unevenly steady. There weren't enough steer calves weighing 450 to 700 pounds to establish a true market test, but higher tones were noted. Slaughter cows sold $3.00 to $4.00 higher and slaughter bulls sold steady. Feeder cattle supply over 600 pounds was 71%. The CME Feeder Cattle Index for Aug. 29: up $0.03, $249.15.
LEAN HOGS:
Traders took a bold move in Wednesday's market and ran the lean hog contracts higher despite fundamental support being questionable. October lean hogs closed $2.87 higher at $83.60, December lean hogs closed $2.27 higher at $75.10 and February lean hogs closed $2.10 higher at $79.10. Come Thursday, the market will again be pressured to either support Wednesday's move or bow down below $82.00. Pork cutout values are unavailable due to packer submission issues. Wednesday's slaughter is estimated at 468,000 head, 4,000 head more than a week ago and 10,000 head less than a year ago. The CME Lean Hog Index for Aug. 28: down $1.48, $92.41.
THURSDAY'S HOG CALL: Steady. Packers have been committed to keeping cash prices steady to somewhat lower, and at this point, it's likely that the trend continues through the week.
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