The mixed movement in livestock futures clearly focused on movements in each complex. Live cattle and feeder cattle futures posted moderate to firm gains, although the buyer support slowly faded near the closing bell. This allowed prices to erode early activity, but still close higher.
Hog futures, on the other hand, posted moderate to active losses with traders focusing not only on fundamental concerns but some technical weakness also developed during the Tuesday session. Hog prices closed lower on the Daily Direct Afternoon hog report, down $1.53 with a weighted average of $73.29 on 7,827 hogs.
December corn closed down 1 at $4.89 and December soybean meal closed up $9.60 at $399.80. The Dow Jones Industrial Average is down 50.33 at 33,934.21.
LIVE CATTLE:
Live cattle futures started the session firmly higher as traders quickly backed away from early-week pressure seen in the complex. But late-day buyer support slowed significantly in the last hour of trade, allowing live cattle futures to hold 30 cents to 35 cents gains at the closing bell in nearby contract months.
The pullback from morning highs has once again pulled spot month December contracts below the 40-day moving average, which seems to be an elusive target to hit over the last week. Despite expectations of firming beef values, it has been difficult to get enough futures buyers excited about the market to maintain firm price support.
Cash cattle activity remains generally quiet with asking prices and bids still hard to accurately pin down. It is likely to be Wednesday at least before active trade develops. There were very few cattle reported sold in Iowa at $185 per cwt live weight, but this is well below the threshold to indicate a price trend at this point. October live cattle closed $0.30 higher at $185.50, December live cattle closed $0.33 higher at $186.875 and February live cattle closed $0.35 higher at $191.
Tuesday's slaughter is estimated at 124,000 head, 4,000 head less than a week ago and 1,000 head less than a year ago.
Boxed beef prices closed higher: choice up $0.47 ($305.14) and select up $1.43 ($278.63) with a movement of 153.25 loads (86.27 loads of choice, 30.26 loads of select, 19.00 loads of trim and 17.72 loads of ground beef).
WEDNESDAY'S CATTLE CALL: Steady to $1 Higher. The lack of overall trade early in the week and expectation of firmness in beef values in the coming weeks is likely to create firmer asking prices through the week but could easily delay trade until late in the week.
FEEDER CATTLE:
Feeder cattle futures were the bright spot of livestock trade Tuesday with triple-digit gains seen in deferred contract months. With corn futures under limited pressure but falling just 1 cent at the end of the trading session, little outside market direction influenced feeder cattle traders.
Only moderate gains developed in nearby contracts, but as traders look toward 2024 contract prices, the focus on firming buyer support is still slowly but steadily moving into the complex. Nearby contracts remain below the 40-day and 100-day moving averages, and near short-term support levels, but given the potential to build solid support at current price levels, traders seem more interested in regaining positions in the near future. October feeders closed $0.48 higher at $248.8, November feeders closed $0.53 higher at $250.45 and January feeders closed $1.28 higher at $252.8.
The CME Feeder Cattle Index for Oct. 13: down $1.43, $246.83.
LEAN HOGS:
December lean hog futures created additional long-term concern following the steady price slide seen over the last week. With contracts closing at $67.55 per cwt, this pushed price levels below the May low and established new contract lows for spot month lean hog futures contracts.
The growing concern that follow-through technical selling may continue to develop in the near future has not only the lean hog market on the defensive but could easily limit buyer support in all livestock trade in the near future. December lean hogs closed $0.75 lower at $67.55, February lean hogs closed $1.03 lower at $72.05 and April lean hogs closed $0.95 lower at $79.00.
Tuesday's hog slaughter is estimated at 483,000 head, 3,000 head less than a week ago, and 3,000 head more than a year ago. Pork Cutouts totaled 354.61 loads with 322.47 loads of pork cuts and 32.14 loads of trim. Pork cutout values are down $1.67 at $89.55.
The CME Lean Hog Index for Oct. 13: down $0.51, $81.60.
WEDNESDAY'S HOG CALL: Steady. The firm pressure in lean hog futures is not expected to have a significant impact on overall cash market movement midweek, although the balance between shifts in pork values and limited expected negotiated trade could limit price moves early in the day.
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