GENERAL COMMENTS:
The spot October live cattle contract hit a new contract high, the spot October feeder cattle contract scored a new contract high and the CME feeder cattle index broke above $250.00 -- talk about a wildly successful Monday for the cattle complex! Heading into Tuesday's market, traders will be eager to see what the day's WASDE report unveils. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.03 with a weighted average price of $79.17 on 1,608 head. December corn is up 2 cents per bushel and December soybean meal is up $3.50. The Dow Jones Industrial Average is up 87.13 points.
LIVE CATTLE:
It was another riveting day for the live cattle complex as traders advanced the spot October contract to yet another new contract high. October live cattle closed $1.00 higher at $184.22, December live cattle closed $0.85 higher at $188.27 and February live cattle closed $1.02 higher at $192.72. This exciting news comes ahead of Tuesday's WASDE report, which will likely lend more support to the market and could even help encourage feedlots into holding their ground and keeping prices at least steady again this week. New showlists appear to be somewhat lower in Nebraska/Colorado, and lower in Kansas and Texas.
Monday's slaughter is estimated at 125,000 head, incomparable to last week but 1,000 head less than a year ago.
Last week, Northern dressed cattle traded on Thursday for $286 to $292, but most at $290, which is mostly steady with the previous week's weighted average. It wasn't until Friday that the Southern Plains traded cattle and most sales were marked at $180 which is roughly $1.00 to $2.00 higher than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 56,819 head. Of that, 78% (44,591 head) are committed for the nearby delivery while the remaining 22% (12,228 head) are committed for the deferred delivery.
Boxed beef prices closed lower: choice down $2.79 ($310.11) and select down $0.61 ($285.44) with a movement of 126 loads (71.08 loads of choice, 31.50 loads of select, zero loads of trim and 23.77 loads of ground beef).
TUESDAY'S CATTLE CALL: Steady to $2.00 higher. Given that packers bought less than 60,000 head of cattle in last week's negotiated cash cattle market, they'll likely need to buy more aggressively this week.
FEEDER CATTLE:
Even though corn prices closed $0.02 to $0.03 higher, the feeder cattle complex didn't bat an eye at the market's uptick as the momentum in the cattle complex was greater. Between the live cattle market's support and the continued support of aggressive feeder cattle buying, the feeder cattle market had no issue closing $1.00 to $2.00 higher Monday afternoon. It's rather impressive that the CME Feeder Cattle Index closed above $250.00, which has historically never been done before. September feeders closed $0.87 higher at $256.22, October feeders closed $2.30 higher at $261.45 and November feeders closed $2.12 higher at $262.02. At Joplin Regional Stockyards in Carthage, Missouri, compared to their last sale two weeks ago and at their midsession point, feeder steers and heifers were both selling steady to $3.00 higher. Feeder cattle supply over 600 pounds was 58%. The CME Feeder Cattle Index for Sept. 8: up $1.21, $250.42.
LEAN HOGS:
The lean hog complex closed higher Monday afternoon as traders were far enough away from resistance to safely advance the contracts without having to make any tough technical decisions. October lean hogs closed $1.02 higher at $82.55, December lean hogs closed $0.20 higher at $74.65 and February lean hogs closed $0.30 higher at $78.85. Tuesday's WASDE report will be interesting for the hog complex as it could help clarify the demand outlook for the later part of the year and into 2024, along with any production changes given the unknowingness of Prop12. Pork cutouts totaled 267.75 loads with 237.73 loads of pork cuts and 30.02 loads of trim. Pork cutout values: up $1.65, $99.45. Monday's slaughter is estimated at 480,000 head, incomparable to last week, but steady with a year ago. The CME Lean Hog Index for Sept. 7: up $0.08, 86.27.
TUESDAY'S HOG CALL: Steady. It's likely that traders will wait until Wednesday before they do much in the cash market.
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