GENERAL COMMENTS:
The livestock contracts are off to a strong start for the week as all three markets enter into Monday's noon hour higher. On Tuesday, the market is expecting to see another WASDE report, which could affect the livestock contracts. December corn is steady and December soybean meal is up $2.50. The Dow Jones Industrial Average is up 72.20 points.
LIVE CATTLE:
The live cattle complex is continuing to trade higher and, as the market flirts with nearing the noon hour, the question now becomes: Will traders push the spot October contract above resistance before the day's end? Traders have been religious about supporting the futures complex over the last week and seem to be committing to pushing prices past resistance as the cash cattle market lends support and as traders believe in the market's long-term bullish trajectory. With Tuesday set to unleash another WASDE report, it wouldn't be out of the ordinary to see traders keep the complex steady through Monday's close and then advance the market on Tuesday if the report is encouraging, or when cash cattle begin to trade later this week. October live cattle are up $0.40 at $183.62, December live cattle are up $0.40 at $187.85 and February live cattle are up $0.50 at $192.20.
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 are lower: choice down $2.70 ($310.20) and select down $0.76 ($285.29) with a movement of 79 loads (39.34 loads of choice, 21.64 loads of select, zero loads of trim and 18.52 loads of ground beef).
FEEDER CATTLE:
The feeder cattle complex is yet again rallying to new contract highs as the market wastes no time in advancing the contracts amid steady corn prices and a supportive live cattle market. It will be interesting to see how the market reacts this week as some sales are shut down this week as sale barn managers and their crews prepare for the long feeder cattle runs that come in the fall. So long as the live cattle market continues to lend feeders support and nothing wild develops in the grain corridor, feeders could maintain these prices as overall the market seems prepared to support the complex's bullish outlook. September feeders are up $0.67 at $256.02, October feeders are up $1.55 at $260.70 and November feeders are up $1.65 at $262.27.
LEAN HOGS:
The lean hog complex is again trading slightly higher as an uptick in pork demand seems to be encouraging traders despite the continued lack of support in the cash market. October lean hogs are up $1.07 at $82.57, December lean hogs are up $0.70 at $75.15 and February lean hogs are up $0.52 at $79.07. It will be essential for the market to continue to see demand from consumers if it's going to maintain somewhat steady trade throughout the futures complex.
The projected lean hog index for Sept. 8 is down $0.10 at $86.17 and the actual index for Sept. 7 is up $0.08 at $86.27. Hog prices are lower on the Daily Direct Morning Hog Report, down $1.55 with a weighted average price of $78.24, ranging from $76.00 to $80.00 on 806 head and a five-day rolling average of $79.33. Pork cutouts total 145.38 loads with 127.67 loads of pork cuts and 17.71 loads of trim. Pork cutout values: up $3.30, $101.10.
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