GENERAL COMMENTS:
Cattle prices backed away from early week gains in both live cattle and feeder cattle futures trade Wednesday morning. Stable to slightly higher grain market prices as well as strong triple-digit losses in the Dow Jones Index has limited follow through buyer support which was very evident Tuesday.
Initial gains in lean hog futures are eroding at midday following the overall softer tone in the livestock market. But it does appear that many lean hog futures traders seem to be content with the current price levels, which could help to establish a market floor during the upcoming month.
March corn is up 1 1/2 at $4.653 and March soybean meal is up $0.90 at $380.4. The Dow Jones Industrial Average is down 228.80 at 37,486.24.
LIVE CATTLE:
Live cattle futures are showing moderate price pressure Wednesday morning with traders adjusting to the sharp early week gains while beef values continue to show price pressure and outside market weakness is developing in the stock market.
February futures are leading the market lower, but the majority of Tuesday's gains are still intact, allowing for potential to bring additional gains back into the market in the last half of the week. Prices are expected to shift within a narrow to moderate range through the rest of the trading session with traders still looking at potential long-term support going into 2024.
Cash cattle activity remains quiet once again although there are scattered bids of $275 per cwt dressed basis in Nebraska. Asking prices have developed around $174 to $174 live basis in the South. Active trade is more than likely to be delayed until sometime Thursday, but there could be some increased sluggish activity over the next few hours.
February live cattle are $1.03 lower at $170.9, April live cattle are $0.53 lower at $173.975, June live cattle are $0.68 lower at $171.25.
Boxed beef prices are mixed: choice down $2.57 ($281.77) and select up $0.38 ($259.24) with a movement of 78.87 loads (43.88 loads of choice, 18.88 loads of select, 4.10 loads of trim and 12.01 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures have adjusted lower through morning trade, although at this point, the market pullback is viewed more as position covering following the aggressive market surge seen Tuesday. The unified movement in cattle trade midweek is allowing traders to focus on potential longer-term market direction as traders try to focus on current positions, but also potential demand shifts expected in the coming weeks.
January feeders are $0.73 lower at $224.7, March feeders are $0.55 lower at $225.9 and April feeders are $0.60 lower at $231.55.
LEAN HOGS:
Lean hog futures have stabilized midweek with prices mixed at midday across the complex. Markets moved higher and lower within a narrow to moderate range through much of the morning. Given the active losses seen over the past week in the lean hog complex and nearby contracts setting contract lows Tuesday, a combination of short covering and repositioning for long-term market price shifts is being done throughout the complex. There still remain concerns about the amount of hogs available to the market and overall demand for pork in the coming months, but the recent market pressure is also leaving prices at a point where the market remains oversold, creating opportunities in the near future for renewed price support.
February lean hogs closed steady, April lean hogs are $0.03 higher at $72.525, and May lean hogs closed steady. Hog Prices are lower on the Daily Direct Morning Hog report, down $3.73 with a weighted average of $44.2, ranging from $41.00 to $47.00 on 1,885 head with a five-day rolling average of $45.83. Pork Cutouts totaled 231.24 loads with 195.56 loads of pork cuts and 35.68 loads of trim. Pork cutout values are down $0.35 at $84.52.
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