GENERAL COMMENTS:
From Friday to Friday, livestock futures scored the following changes: December Live cattle up $3.63, February Live cattle off $0.03; January Feeder cattle off $0.45, March Feeder cattle off $1.30; February Lean hogs off $3.38, February Lean hogs off $3.38; February Pork cutout up $0.00, April Pork cutout off $0.00.
Most of the price shifts Friday took place in December live cattle contracts which posted a $2.47 per cwt rally. With spot December contracts expiring during the trading session, traders rolled out of these contract as they settled. The rest of the livestock complex remained lightly traded with price movements mixed in a narrow to moderate trading range, indicating very little direction on the last trading day of the year. The overall sluggish market activity is no shock given that volume has been extremely light all week due to the holiday week, and very little technical or fundamental market direction is seen in the last few days of 2023 trade.
Markets will remain closed until Tuesday morning due to the New Year's Day on Monday. It is expected that more normal market activity will resume early next week as traders adjust from the market shifts seen this week and prepare for more activity during January. Hog prices closed lower on the Daily Direct Afternoon hog report, down $2.79 with a weighted average of $43.57 on 2,217 hogs.
March corn closed down 3 at $4.713 and March soybean meal closed down $4.70 at $386.00. The Dow Jones Industrial Average is down 20.56 at 37,689.54.
LIVE CATTLE:
Live cattle turned sharply higher in the expiring December contract month, pushing spot month prices $2.47 per cwt to $173.67 per cwt. The combination of limited opening interest just before settlement and very thinly traded market activity on the last day of the year added to price volatility in this contract. The rest of the live cattle contracts were quiet with prices hovering within a narrow to moderate, but mixed trading range, indicating very little market direction Friday.
Following a week of very light trade and sluggish market volume, the live cattle complex limped into the end of the year. There is expectations that more volume will be seen early next week once markets come to life, but prices may still be challenged with any sense of short term market direction, as the sideways market trend seen through most of December may carry well into January.
Cash cattle trade are showing a few deals reported in parts of Kansas at $173, $1 higher than yesterday's sales, and $2 higher than last week's weighted averages. Wednesday's business had Southern live deals marked at mostly $172, $1 higher than the prior week's weighted averages, Northern dressed business came in at mostly $272 to $273, $2 to $3 higher than the previous week's weighted average basis Nebraska. Asking prices for cattle left on showlists are around $174-plus in the South, and $274-plus in the North. Having said that, it looks like the bulk of business could essentially be completed for the week, although a little cleanup is not out of the question Friday.
December live cattle closed $2.48 higher at $173.675, February live cattle closed $0.43 lower at $168.5 and April live cattle closed $0.03 lower at $172.25.
Friday's slaughter is estimated at 125,000 head, 8,000 head more than a week ago and 6,000 head more than a year ago. Estimated Saturday slaughter is 33,000 head moving the weekly slaughter to 508,000 head.
Boxed beef prices closed mixed: choice down $1.57 ($289.71) and select up $1.09 ($260.33) with a movement of 94.26 loads (65.32 loads of choice, 11.56 loads of select, 5.91 loads of trim and 11.47 loads of ground beef).
TUESDAY'S CATTLE CALL: Steady. Limited activity is expected early next week following the long holiday weekend and shortened procurement week. It is likely that significant bids and asking prices may be moved to midweek or later.
FEEDER CATTLE:
Feeder cattle futures broke away from the wide price swings Friday with nearby contracts stuck in a very narrow but mixed trading range with very limited market movement and essentially no sense of market direction on the last trading day of the year. More active gains moved into deferred contract months, but this support is based more on very limited interest as most traders have already exited the market for the holiday weekend.
More trade activity, volume and general market direction is expected to develop early next week when markets open, but the overall tone of the market is still likely to remain unsettled once market fundamentals are focused on during early January.
January feeders closed $0.18 lower at $222.3, March feeders closed $0.03 lower at $223.1 and April feeders closed $0.03 lower at $228.9. The CME Feeder Cattle Index for Dec. 27: down $1.73, $215.98.
LEAN HOGS:
Lean hog futures moved very little in most contracts Friday as limited activity was seen at the end of the week and last trading day of the year. Spot February futures fell 47 cents per cwt, but the rest of the complex was contained in a narrow range from 15 cents lower to 20 cents lower as traders quickly exited the market ahead of the long holiday weekend and will wait until early next week to sort out any future movement in the market. February lean hogs closed $0.48 lower at $67.975, April lean hogs closed $0.15 lower at $74.85 and May lean hogs closed $0.08 higher at $81.50.
Friday's hog slaughter is estimated at 485,000 head, 53,000 head more than a week ago and 3,000 head less than a year ago. Saturday runs are expected at 319,000 head. Total estimated weekly slaughter, including Saturday's runs are 2.23 million head. Pork Cutouts totaled 294.70 loads with 264.22 loads of pork cuts and 30.48 loads of trim. Pork cutout values are up $2.15 at $84.76. The CME Lean Hog Index for Dec. 27: down $0.14, $65.57.
TUESDAY'S HOG CALL: Steady. Except for a new year to be printed on the checks, not a lot is expected to change early next week. The continued concern of steady to strong supply levels and questions about pork demand will likely leave packers bidding generally steady during another week of short plant runs.
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