GENERAL COMMENTS:
Although there are still two trading days before the Thanksgiving holiday break, the market seems to be on a general holiday schedule Tuesday with trade activity and overall market interest remaining very light. This has led to moderate to active price pressure in all livestock futures with cattle and hog futures posting triple-digit losses in several contract months at midday.
Lean hog futures are showing the most pressure, although this is still keeping prices hovering in the recent sideways trend as traders seem uninterested in actively stepping into the complex during the holiday week. The limited overall trade could also allow for further price shifts to develop in a moderate and potentially mixed range through the rest of the week.
December corn is steady at $4.695 and January soybean meal is down $2.70 at $440.6. The Dow Jones Industrial Average is down 75.58 at 35,075.46.
LIVE CATTLE:
Moderate to firm losses have developed Tuesday morning as trader interest remains extremely limited. It appears that many traders have already checked out ahead of the Thanksgiving holiday, and this is allowing for limited buyer support to develop. Monday's price shifts appear to have satisfied traders' expectations following last week's Cattle on Feed report, with limited overall short- or long-term market direction being focused on until after Thanksgiving.
Traders will continue to monitor outside market shifts as well as fundamental moves in beef values and cash markets, but even these factors are likely to give limited direction over the next few days. Even though firm losses have developed Tuesday, the light activity and limited volume could easily allow for moderate to wide price swings with very little notice or any apparent reason other than the limited activity levels.
Cash cattle markets remain quiet Tuesday morning with bids and asking prices still unavailable. It is still expected that both sides will desire to wrap up needed trade by Wednesday evening before the Thanksgiving holiday, but at this point it very could be Wednesday or later before any significant business is reported.
December live cattle are $0.55 lower at $174.925, February live cattle are $0.88 lower at $175.775, April live cattle are $0.60 lower at $178.125.
Boxed beef prices are lower: choice down $0.24 ($295.51) and select down $0.15 ($270.80) with a movement of 67.10 loads (45.65 loads of choice, 13.43 loads of select, zero loads of trim and 8.02 loads of ground beef).
FEEDER CATTLE:
Firm pressure is seen in feeder cattle futures midday Tuesday, although prices have pulled away from session lows as early selling pressure has slowed. Trade volume remains very light, and limited pre-holiday activity is likely to keep markets generally undirected and moving within a choppy, but moderate price range over the next few days.
Traders are looking for longer-term market direction from the cattle market, in some ways ignoring the overall holiday noise in the market, even though this is allowing for a moderate price pullback in most contracts Tuesday morning. Limited overall direction and trade is likely not only to be seen Tuesday, but all week as many traders seem to have already been checked out of the market until next week.
The challenge with such light trade is that prices can quickly and easily move wide ranges in either direction due to overall lack of activity and a few traders on one side in the market at a time. This significant disrupts chart accuracy but has little to do with overall trader long term direction. January feeders are $1.20 lower at $228.65, March feeders are $0.93 lower at $231.375 and April feeders are $0.85 lower at $234.975.
LEAN HOGS:
Lean hog futures continue to show the most aggressive pressure Tuesday morning. February through May contracts are holding losses of $2 per cwt lower, and limited overall support is expected in all contracts through the rest of the session. Holiday apathy is one of the main reasons for the limited support as many traders are absent from the market ahead of the Thanksgiving holiday. There is expected to be additional underlying support over the next couple of weeks, if cash values can start to firm and renewed support is consistently developing in pork values.
Even though prices have posted strong losses, the market remains comfortably rooted within a wide sideways trading range, which could limit technical market shifts over the near future. December lean hogs are $1.78 lower at $68.575, February lean hogs are $2.48 lower at $72.575 and April lean hogs are $2.28 lower at $78.70
Hog Prices are lower on the Daily Direct Morning Hog report, down $0.93 with a weighted average of $61.34, ranging from $56.00 to $63.00 on 10,500 head with a five-day rolling average of $62.54. Pork Cutouts totaled 167.36 loads with 150.31 loads of pork cuts and 17.05 loads of trim. Pork cutout values are down $1.19 at $86.57.
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