Wednesday Closing Livestock Market Update - Hogs Close Higher While Cattle Round out the Day Mixed

GENERAL COMMENTS:

Wednesday ended up being a strong day for the hog complex as better packer interest in the cash market helped rally the futures complex. But unfortunately, the cattle complex had a mostly lackadaisical day without much happening as the cash cattle market has yet to trade. December corn is down 5 1/4 cents per bushel and December soybean meal is down $2.30. The Dow Jones Industrial Average is up 99.46 points.

LIVE CATTLE:

Wednesday didn't end up being much of a day at all for the live cattle complex as traders merely left the contracts drift lower through the day's end and no cash cattle sales were noted. August live cattle closed $0.57 lower at $187.12, October live cattle closed $0.77 lower at $186.67 and December live cattle closed $0.30 lower at $187.87. And between seeing mixed signals from the boxed beef complex, and still no clear direction as to how this week's cash cattle market is going to shake out -- another day of a slightly lower close was an easy option for traders. Asking prices in the South are noted at $190 to $192 but are still not established yet in the North. 

Wednesday's slaughter is estimated at 122,000 head -- steady with a week ago and 1,000 head less than a year ago.

Boxed beef prices closed mixed: choice up $0.29 ($314.77) and select down $1.22 ($300.16) with a movement of 145 loads (94.06 loads of choice, 27.49 loads of select, 9.27 loads of trim and 13.86 loads of ground beef).

THURSDAY'S CATTLE CALL: Steady. Feedlots are aiming for at least steady money this week following last week's $2.00 advancement, but it's anyone's guess at this point on who's going to win the cash cattle market's battle – packers or feedlot managers?

FEEDER CATTLE:

It was surprising to see some of the feeder cattle contracts turn higher after the noon hour as the live cattle market kept with its lower trend all the way through the day's end. Even so, traders acknowledged the corn markets descend and between the slight decrease in corn prices and the continued support of buyers in the countryside -- traders opted to push the nearby contracts higher through the day's close even without the support of the live cattle market. August feeders closed $0.27 higher at $257.25, September feeders closed $0.15 higher at $257.10 and October feeders closed $0.27 higher at $256.15. The CME feeder cattle index 7/30/2024: down $0.04, $258.69.

LEAN HOGS:

With the help of a little extra fundamental support from the cash hog complex, the lean hog contracts were able to round out Wednesday's trade higher. August lean hogs closed $1.07 higher a $92.27, October lean hogs closed $1.15 higher at $75.92 and December lean hogs closed $1.10 higher at $68.72. Unfortunately, with the ham's $6.55 decline, the afternoon carcass price was no help as it rounded out the afternoon slightly lower. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $1.08 with a weighted average price of $85.76 on 12,411 head. Pork cutouts total 261.71 loads with 213.88 loads of pork cuts and 47.83 loads of trim. Pork cutout values: down $0.72, $104.88. Wednesday's slaughter is estimated at 481,000 head -- 2,000 head more than a week ago and 7,000 head more than a year ago. The CME lean hog index 7/29/2024: up $0.30, $92.59.

THURSDAY'S HOG CALL: Lower. With packers buying over 12,000 head in today's cash market they've likely fulfilled their needs for the week and will likely be far less aggressive through the week's end in the cash market.

Wednesday Midday Livestock Market Summary - Hogs Higher as Packers Jump Aggressively Into Cash Market

GENERAL COMMENTS:

With packers aggressively pushing the cash hog market up over $6.00 higher Wednesday morning, it's no wonder the lean hog complex is trading higher into Wednesday's noon hour. But, unfortunately, the cattle complex hasn't come into that much support, so both the live cattle and feeder cattle contracts are lower. December corn is down 2 3/4 cents per bushel and December soybean meal is down $0.80. The Dow Jones Industrial Average is up 230.53 points.

LIVE CATTLE:

Even though boxed beef prices are higher, traders thus far haven't found enough support in Wednesday's market to comfortably allow the live cattle complex to trade higher. August live cattle are down $0.90 at $186.80, October live cattle are down $1.17 at $186.27 and December live cattle are down $0.90 at $187.27. If the cash cattle market is indeed able to trade cattle higher this week, that may be enough support to change trader attitudes. But at this point no cash sales have developed. Asking prices are noted in the South at $190 to $192 but are still not established in the North. Given that no bids are currently being offered, it looks like trade will be delayed until Thursday or even potentially Friday.

Boxed beef prices are higher: choice up $0.95 ($315.43) and select up $0.60 ($301.98) with a movement of 81 loads (54.23 loads of choice, 11.91 loads of select, 7.82 loads of trim and 6.78 loads of ground beef).

FEEDER CATTLE:

Once again, because the live cattle contracts are trading lower, the feeder cattle contracts are following suit. August feeders are down $0.25 at $256.72, September feeders are down $0.50 at $256.45 and October feeders are down $0.45 at $255.42. Unless something positive develops in the fed cash cattle market or the live cattle complex has a change of heart and begins to trade higher, it's likely feeders will round out the day with this weaker tone.

LEAN HOGS:

The lean hog complex is higher as we approach Wednesday's noon hour as traders can hardly believe packer demand already this morning. Packers have been aggressive in this morning's market as they've already bought over 12,000 head of hogs and in doing so have pushed the cash market $6.12 higher. Meanwhile, pork cutout values are lower, which is really only because the ham has fallen $7.22; otherwise most of the cuts are trading higher and there's still a chance the afternoon carcass price could turn higher. August lean hogs are up $0.60 at $91.80, October lean hogs are up $1.00 at $75.80 and December lean hogs are up $0.72 at $68.35.

The projected CME Lean Hog Index for 7/30/2024 is up $0.49 at $93.08, and the actual index for 7/29/2024 is up $0.30 at $92.59. Hog prices are higher on the Daily Direct Morning Hog Report, up $6.12 with a weighted average price of $85.80, ranging from $78.00 to $88.75 on 12,093 head and a five-day rolling average of $85.01. Pork cutouts total 164.72 loads with 131.09 loads of pork cuts and 33.62 loads of trim. Pork cutout values: down $0.66, $104.94.

Wednesday Morning Livestock Market Update - Futures May Show Further Stability

GENERAL COMMENTS:

Cattle futures found sufficient buying interest on the break for the complex to close higher. After all, cash cattle gained $2.00 last week, which seemed to indicate the selling Monday was technically driven. The current anticipation is for cash to trade steady this week but it is too early to feel confident in that. Boxed beef was lower Tuesday with choice down $0.33 and select down $0.14. This should not put pressure on the market as the decline was negligible. It is doubtful cash cattle will trade Wednesday as feedlots will set their sights higher due to advancing the market last week.

Hog futures ran out of heavy selling pressure, closing slightly lower Tuesday. This may indicate the liquidation phase was confined to one day with the market now looking back at the fundamentals. The National Daily Direct Afternoon Hog report showed cash up $0.61 with higher cash also expected Wednesday as the packers try to finish up most of their purchases for the week. Cutouts took it on the chin with a decline of $1.18, keeping some pressure on the market. If the selloff Monday was truly technical, futures should regain what was lost over time as the recent fundamentals suggest higher prices.

	BULL SIDE		BEAR SIDE
1)	Cattle futures only experienced one day of heavy selling which indicates the market has corrected and traders might buy back into the market on the break.	1)	Traders may remain cautious until they see if cash will be able to hold this week. Packers may not be too anxious to pay more for cattle after the gains last week.
2)	Cash cattle are anticipated to trade at steady cash, which indicates futures are carrying a discount that may be erased.	2)	Further weakness of boxed beef through the rest of the week could erode futures prices as packers may slow the slaughter pace.
3)	August hogs have a chart gap above the market that may be closed over the next two weeks before the contract goes off the board.	3)	Hog futures have a lot to regain to resume the uptrend. Both cash and cutouts will need to trend higher to move futures back to where they were.
4)	Packers continue to remain aggressive with hog purchases and slaughter as demand is doing well. Packer margins are good, keeping the slaughter pace strong.	4)	Traders remain bearish through the end of the year as the October and December contracts hold a substantial discount to the August contract.

Tuesday Closing Livestock Market Update - Cattle Find Slightly Better Support

GENERAL COMMENTS:

Tuesday ended up being a mixed day for the livestock complex as cattle gained a little more support ahead of the day's end, but the lean hog complex closed fully lower and pork cutout values dipped too. December corn is down 7 1/4 cents per bushel and December soybean meal is down $5.50. The Dow Jones Industrial Average is up 119.30 points.

LIVE CATTLE:

Traders remain extremely mindful of the market's new resistance plane while was established just last Thursday when the spot October contract ran to the highest price point seen since last October. But with Monday's sharp descend, traders were able to allow the live cattle complex to close mildly higher as they acknowledged that they were no longer up against immediate resistance pressure. August live cattle closed $0.72 higher at $187.70, October live cattle closed $0.65 higher at $187.45 and December live cattle closed $0.50 higher at $188.17. Still no developments have surfaced in the cash cattle complex, and it's likely at this point that trade could be delayed until after Wednesday at some point. Bids and asking prices still remain elusive. 

Tuesday's slaughter is estimated at 123,000 head -- steady with a week ago and 1,000 head less than a year ago.

Boxed beef prices closed lower: choice down $0.33 ($314.48) and select down $0.14 ($301.38) with a movement of 119 loads (74.13 loads of choice, 23.11 loads of select, 10.01 loads of trim and 12.02 loads of ground beef).

WEDNESDAY'S CATTLE CALL: Steady. Given that feedlots were able to advance the cash market $2.00 last week, it's likely that the market will trade steady at best this week.

FEEDER CATTLE:

After Tuesday's noon hour, the live cattle complex had a change of heart as traders gave credit to the fact that boxed beef prices are seeing better consumer demand than what was originally expected for late July. The change in market direction for the live cattle complex was just enough to help the feeder cattle market change its attitude as well, but it didn't hurt matters either than the corn complex closed anywhere from $0.06 to $0.07 lower too. August feeders closed $0.55 higher at $256.97, September feeders closed $0.87 higher at $256.95 and October feeders closed $0.67 higher at $255.87. At Oklahoma National Stockyards in Oklahoma City, Oklahoma compared to last week feeder steers traded weaker, with some instances of $5.00 lower on those weighing more than 800 pounds. Feeder heifers sold $2.00 to $5.00 higher. Steer and heifer calves traded steady to $4.00 higher. Feeder cattle supply over 600 pounds was 66%. The CME feeder cattle index 7/29/2024: down $0.02, $258.73.

LEAN HOGS:

Traders weren't able to keep some of the lean hog complex trading higher as the afternoon's pressure weighed on the market. But even so, the day's trade wasn't a total wash as at least cash prices saw a little better interest as just shy of 8,000 head sold. Unfortunately, pork cutout values closed lower, as the only cut that posted a higher close for the day was the rib (up $1.94) but otherwise all the other major cuts rounded out the day weaker. August lean hogs closed $0.25 lower at $91.20, October lean hogs closed $0.05 lower at $74.77 and December lean hogs closed $0.22 lower at $67.62. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.61 with a weighted average price of $84.68 on 7,973 head. Pork cutouts totaled 267.45 loads with 235.08 loads of pork cuts and 32.36 loads of trim. Pork cutout values: down $1.18, $105.60. Tuesday's slaughter is estimated at 481,000 head -- steady with a week ago but 3,000 head more than a year ago. The CME lean hog index 7/28/2024: up $0.44, $92.29.

WEDNESDAY'S HOG CALL: Steady. Given that packers showed a little more interest in Tuesday's cash market, it's still not likely that they secured all their cash needs already for the week so Wednesday's market will likely see the same type of interest from packers.

Tuesday Midday Livestock Market Summary - Traders Remain Skeptical of Complex

GENERAL COMMENTS:

The livestock complex is mostly lower as the market simply cannot gain support from traders at this point. Even though boxed beef prices and pork cutout values are higher, traders remain extremely cautious when handling the livestock market. December corn is down 6 1/4 cents per bushel and December soybean meal is down $3.80. The Dow Jones Industrial Average is up 34.25 points.

LIVE CATTLE:

Even though boxed beef prices are higher, the live cattle complex is trading lower into Tuesday's noon hour as traders seem simply unwilling to take on the resistance formed last week. August live cattle are steady at $186.97, October live cattle are down $0.17 at $186.60 and December live cattle are down $0.12 at $187.55. No bids or asking prices have surfaced yet and it's likely the cash cattle market waits to trade until after Wednesday at some point. It's most likely prices will be best seen at steady following last week's $2.00 advancement.

Boxed beef prices are higher: choice up $0.91 ($315.72) and select up $1.84 ($303.36) with a movement of 54 loads (32.76 loads of choice, 9.21 loads of select, 4.57 loads of trim and 7.90 loads of ground beef).

FEEDER CATTLE:

With the live cattle contracts trading lower, it's somewhat expected at this point that feeders would only be trading lower too as traders seem somewhat unwilling to given credit and merit to the demand in the countryside for feeders, and only seem concerned with the board's behavior. August feeders are down $0.10 at $256.32, September feeders are down $0.05 at $256.02 and October feeders are down $0.25 at $254.95. Unless the fed cash cattle market is able to trade cattle steady to somewhat higher later this week, the feeder cattle complex could continue with this steady/somewhat lower trend.

LEAN HOGS:

The lean hog complex continues to pace back and forth, trying to determine what direction is best for the market this week. As Tuesday noon approaches, the market remains mixed with just the August and October 2024 contracts trading slightly higher while the rest of the contracts trade mildly lower. It's somewhat helpful that midday pork cutout values are higher but seeing cash prices down over $4.00 was a bit surprising given that packers hardly bought any hogs at all in Monday's cash market. August lean hogs are up $0.12 at $91.57, October lean hogs are up $0.07 at $74.90 and December lean hogs are down $0.20 at $67.65.

The projected CME Lean Hog Index for 7/29/2024 is up $0.30 at $92.59, and the actual index for 7/26/2024 is up $0.44 at $92.29. Hog prices are lower on the Daily Direct Morning Hog Report, down $4.48 with a weighted average price of $79.68, ranging from $75.00 to $85.00 on 1,113 head and a five-day rolling average of $82.93. Pork cutouts total 164.65 loads with 140.76 loads of pork cuts and 23.89 loads of trim. Pork cutout values: up $0.14, $106.92.

Tuesday Morning Livestock Market Update - Futures May Begin Day Under Pressure

GENERAL COMMENTS:

Feeder cattle showed the most pressure Monday, falling to the bottom of the recent trading range. Support will need to hold or further liquidation could develop. The optimism over higher cash prices last week for live cattle was quickly erased Monday, but not because of lower cash last week or lower boxed beef prices. Boxed beef was higher with choice up $1.04 and select up $4.06. That should provide support as it is the most gains seen over the past few weeks. However, traders decided to take profits or hedge the higher prices as a precaution against lower cash this week

Hogs fell apart Monday as the market corrected after the sharp increase over the past few weeks and the inability of futures to push above chart resistance. The liquidation continued as the day progressed, even though cash and cutouts were positive. Cash was higher at midday and continued that way through the day. The National Direct Afternoon Hog report showed cash up $1.94. Cutouts showed a solid increase with a gain of $1.61. Further gains in cash and cutouts are expected Tuesday.

	BULL SIDE		BEAR SIDE
1)	The anticipation of higher cash cattle this week may have dissipated, but steady cash should support the market.	1)	Cattle futures falling back quickly may indicate traders are unwilling to push the market higher with a level of price resistance having been reached.
2)	The strong boxed beef prices Monday may indicate consumers have increased their demand for beef after a few weeks of lower consumption. Higher boxed beef prices will provide support to the market.	2)	Feeder cattle futures fell to a technical support level. If further weakness is seen, futures may continue to decline.
3)	The packers were aggressive with hog purchases Monday, purchasing supplies early in the week rather than later. The increased slaughter pace requires more hogs.	3)	Hog futures could not penetrate technical resistance Monday, triggering selling with stops being hit, further weakening the market.
4)	The higher cash and cutouts indicate demand remains strong, rendering the selling of hog futures as a market correction rather than a change in trend.	4)	Further liquidation may continue as fund selling generally runs for two or three days before the selling pressure subsides.

Monday Closing Livestock Market Update - Complex Sharply Lower

GENERAL COMMENTS:

Monday's market was a swing and a miss for the livestock complex as all three of the markets closed lower thanks to trader cautiousness and hesitancy. It seems as though traders are simply unwilling to advance the complex ahead of see what fundamental support arises this week. December corn is up 2 1/4 cents per bushel and December soybean meal is down $1.20. The Dow Jones Industrial Average is up 27.88 points.

LIVE CATTLE:

The live cattle complex wasn't able to shake the technical pressure which plagued the entire livestock sector through Monday's trade. August live cattle closed $1.60 lower at $186.97, October live cattle closed $1.75 lower at $186.80 and December live cattle closed $1.62 lower at $187.67. After rallying to prices not seen since last October in the spot October contract, the market remains hesitant ahead of seeing what fundamental support (especially in the forms of boxed beef prices/demand, and what the cash cattle market does) arises this week. Monday's slaughter is estimated at 115,000 head -- steady with a week ago but 6,000 head less than a year ago. New showlists appear to be mixed, higher in Kansas, and Nebraska/Colorado, but lower in Texas.

Last week Northern dressed cattle traded for mostly $312 which is $2.00 higher than the previous week's weighted average, and Southern live cattle traded for mostly $190 which is also $2.00 higher than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 73,164 head. Of that 79% (57,696 head) were committed to the nearby delivery, while the remaining 21% (15,468 head) were committed to the deferred delivery.

Boxed beef prices closed higher: choice up $1.04 ($314.81) and select up $4.06 ($301.52) with a movement of 145 loads (91.63 loads of choice, 22.74 loads of select, 12.50 loads of trim and 18.58 loads of ground beef).

TUESDAY'S CATTLE CALL: Steady. Given that the cash cattle market traded $2.00 higher last week likely means that the market's best scenario is trading steady this week as packers desperately want the fed cash cattle market to soften to help their own margins.

FEEDER CATTLE:

The feeder cattle complex suffered the same technical pressure that the rest of the livestock market did. And without any added support from the live cattle contracts, the feeder cattle complex stood little chance of trading higher as traders seem more concerned about the direction of the live cattle contracts as opposed to what buyer demand is doing in the countryside. August feeders closed $3.27 lower at $256.42, September feeders closed $3.52 lower at $256.07 and October feeders closed $3.10 lower at $255.20. Today's descent did put the spot August contract back below both its 40-day and 100-day moving averages. At Joplin Regional Stockyards in Carthage, Missouri compared to last week feeder steers under 775 pounds sold $3.00 to $7.00 lower while the heavier weighted steers traded steady. Feeder heifers sold $3.00 to $8.00 softer. Feeder cattle supply over 600 pounds was 67%. The CME feeder cattle index 7/26/2024: down $0.11, $258.75.

LEAN HOGS:

The lean hog complex can't blame its fundamentals for not being supportive as the reason why the market closed lower. Pork cutout values aided ample support to the hog complex, and yes, cash prices closed higher too, but given that it was only on 816 head makes it less influential. But like the rest of the livestock complex, traders kept their distance from the hog complex through Monday's trade which consequently led to a lower end. August lean hogs closed $2.02 lower at $91.45, October lean hogs closed $3.37 lower at $74.82 and December lean hogs closed $2.47 lower at $67.85. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $1.94 with a weighted average price of $84.07 on 816 head. Pork cutouts totaled 243.78 loads with 214.94 loads of pork cuts and 28.84 loads of trim. Pork cutout values: up $1.61, $106.78. Monday's slaughter is estimated at 482,000 head -- 29,000 head more than a week ago and 5,000 head more than a year ago. The CME feeder cattle index 7/25/2024: up $0.46, $91.85.

TUESDAY'S HOG CALL: Higher. Given that traders paid virtually no attention to Monday's market (as they only purchased 816 head) it's likely that they'll have to be more aggressive in Tuesday's cash market.

Monday Midday Livestock Market Summary - Weaker Tones Summarize the Complex

GENERAL COMMENTS:

Technical pressures are driving the livestock contracts lower into Monday's noon hour. Unfortunately, it's unlikely that the market will shake this tone ahead of the day's end as traders are distancing themselves from the livestock complex until they see better demand and fundamental support. December corn is down 1/4 cent per bushel and December soybean meal is down $3.00. The Dow Jones Industrial Average is up 12.86 points.

LIVE CATTLE:

After rallying to a new higher for the current trading range just last week, the live cattle complex is back to trading lower as traders look for continued fundamental support before they'll comfortably advance the market anymore. August live cattle are down $0.70 at $187.87, October live cattle are down $1.10 at $187.42 and December live cattle are down $1.15 at $188.15. It will be interesting to see how this week's cash market shakes out as last week feedlots were able to advance the cash market $2.00 against the seasonal norm.

Last week Northern dressed cattle traded for mostly $312 which is $2.00 higher than the previous week's weighted average, and Southern live cattle traded for mostly $190 which is also $2.00 higher than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 73,164 head. Of that 79% (57,696 head) were committed to the nearby delivery, while the remaining 21% (15,468 head) were committed to the deferred delivery.

Boxed beef prices are mixed: choice down $0.02 ($313.75) and select up $2.61 ($300.07) with a movement of 80 loads (58.49 loads of choice, 8.86 loads of select, zero loads of trim and 12.23 loads of ground beef).

FEEDER CATTLE:

For awhile the feeder cattle complex was trading higher but as Monday's noon hour quickly approaches, the complex has lost some of it's might as the live cattle market isn't lending any support. August feeders are down $2.40 at $257.37, September feeders are down $2.75 at $256.85 and October feeder cattle are down $2.17 at $256.12. The day's descent has sent the spot August contract trading back below both its 100-day and 40-day moving averages.

LEAN HOGS:

The lean hog complex is also trading lower even though the market's fundamentals are lending ample support. On a normal day you'd expect the lean hog contracts to be trading higher when both the cash market and pork cutout values are higher, but the announcement that two new cases of African swine fever found in pig herds in Germany seems to be weighing heavily on the complex at this point. August lean hogs are down $2.15 at $91.32, October lean hogs are down $3.30 at $74.90 and December lean hogs are down $2.32 at $68.00.

The projected lean hog index is delayed from the source. Hog prices are higher on the Daily Direct Morning Hog Report, up $2.03 with a weighted average price of $84.16, ranging from $78.00 to $85.00 on 703 head and a five-day rolling average of $83.71. Pork cutouts total 134.84 loads with 117.85 loads of pork cuts and 16.99 loads of trim. Pork cutout values: up $2.44, $107.61.

Monday Morning Livestock Market Update - Mixed Futures as Traders Look For Direction

GENERAL COMMENTS:

Cash cattle traded higher for the week with Southern cattle up $2.00 and Northern dressed cattle up $2.00. Futures had this factored in, leaving the market mixed into the close Friday. Higher boxed beef prices may provide support Monday, but traders may wait to see whether that will come to fruition before becoming too excited. Boxed beef on Friday showed choice cuts up $1.31 and select up $2.35. The Commitments of Traders report showed funds increasing their net live cattle futures position by 1,677 contracts and are now holding a net-long position of 66,718 contracts. Funds reduced their net-long futures position by 430 contracts with a net-long position of 2,781.

Hog futures posted another strong week as demand improved with futures extending the previous week's gains. The October and December contracts hold a steep discount to the August contract as traders remain cautious over continued strong demand after the summer months. The packers have been aggressive recently and should continue this week. Cash is expected higher Monday as packers want to purchase more aggressively at the beginning of the week to gain ownership. Pork cutouts were down $0.78 Friday. The Commitments of Traders report showed fund traders buying 7,821 futures contracts last week, reducing their net-short positions to 6,158.

	BULL SIDE		BEAR SIDE
1)	Higher cash cattle last week should keep support under the market. Beef demand has slowed but cattle supplies remain tight.	1)	Beef imports are running at a significantly high level recently which may continue to minimize the upside price potential of cattle.
2)	August and October live cattle futures broke through and closed above chart resistance. This could increase trader buying interest.	2)	Boxed beef prices have been under pressure, which is expected to continue this week despite higher prices Friday.
3)	Hogs remain supported as demand has improved and packers have been more aggressive in the cash market. Higher cash is expected Monday.	3)	Hog futures have had an impressive increase and may see a price retracement with some profit-taking in case weakness develops in pork demand.
4)	Pork packer margins are good and in line with last year and the 3-year average. This will encourage a strong slaughter pace and strong buying interest.	4)	The August and October hog contracts have a chart gap below the market that may be filled. This may take place over the next two weeks before the August contract goes off the board.

Friday Closing Livestock Market Update - Northern Cattle Sell for $312 -- $2.00 Higher

GENERAL COMMENTS:

It was a powerful day for the cattle complex as boxed beef prices rounded out the day higher and Northern trade finally cut loose and was marked at mostly $312 which is $2.00 higher than last week's weighted average. December corn is down 10 3/4 cents per bushel and December soybean meal is down $4.50. The Dow Jones Industrial Average is up 654.27 points.

From Friday-to-Friday livestock futures scored the following changes: August live cattle up $5.48, October live cattle up $5.08; August feeder cattle up $4.10, September feeder cattle up $3.83; August lean hogs up $1.90, October lean hogs up $3.65; September corn up $0.04, December corn up $0.05.

LIVE CATTLE:

What a week it was for the live cattle complex! Between seeing the spot October contract reach a price point in which hasn't been last tested since October 2023, to seeing boxed beef prices strength slightly, to seeing the fed cash cattle market gain $2.00 -- the live cattle market had a stellar week. Yes, some of the nearby contracts did close slightly lower, but after Thursday's powerful surge, a slightly weaker close on Friday was somewhat expected. August live cattle closed $0.32 lower at $188.57, October live cattle closed $0.05 lower at $188.55 and December live cattle closed $0.40 higher at $189.30. Some Northern trade has finally been reported at $312, which is $2.00 higher than last week's weighted average. On Thursday Southern live cattle traded at $190 which is also $2.00 higher than last week's weighted average.

Friday's slaughter is estimated at 110,000 head -- 11,000 head more than a week ago and steady with a year ago. Saturday's slaughter is projected to be around 10,000 head. The week's total slaughter is estimated around 600,000 head -- 16,000 head more than a week ago and 15,000 head less than a year ago.

Boxed beef prices closed higher: choice up $1.31 ($313.77) and select up $2.35 ($297.46) with a movement of 101 loads (65.86 loads of choice, 12.83 loads of select, 9.02 loads of trim and 13.48 loads of ground beef).

MONDAY'S CATTLE CALL: Steady. Given that this week's market traded higher, packers will likely try to work prices lower next week.

FEEDER CATTLE:

It was promising to see the feeder cattle complex keep with its upward trend through Friday's close as the market leaned into its own fundamental support and maintained its positive position above both the 40-day and 100-day moving averages. August feeders closed $1.07 higher at $259.70, September feeders closed $1.70 higher at $259.60 and October feeders closed $1.22 higher at $258.30. But between seeing the fed cash cattle market trade higher in late July, to seeing demand in the countryside remain incredibly strong despite temperatures being hot, the market had little reason to trade lower. The Oklahoma Weekly Cattle Auction Summary shared that compared to last week and throughout the entire state steer calves sold $2.00 to $6.00 higher and feeder heifers sold $2.00 to $4.00 higher. Heifer calves traded $2.00 to $4.00 lower. Slaughter cows sold steady to $1.00 higher and slaughter bulls traded $1.00 higher. Feeder cattle supply over 600 pounds was 63%. The CME feeder cattle index 7/25/2024: down $0.22, $258.84.

LEAN HOGS:

Even though pork cutout values closed slightly lower, the lean hog complex was able to round out the day mostly higher as traders merely let the market chop sideways ahead of the day's end. All in all, it was a powerful week for the lean hog complex as the market gained substantial ground technically and was empowered mostly by the market's uptick in seasonal demand from consumers. Traders are hoping that pork demand remains strong next week which could allow for the futures complex to potentially keep with its upward trend if traders are willing to take on the market's current resistance plane around $78.00. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.38 with a weighted average price of $82.13 on 1,045 head. Pork cutouts totaled 262.83 loads with 236.83 loads of pork cuts and 26.00 loads of trim. Pork cutout values: down $0.78, $105.17. Friday's slaughter is estimated at 438,000 head -- 18,000 head more than a week ago and 21,000 head less than a year ago. The CME lean hog index 7/24/2024: up $0.62, $91.39.

MONDAY'S HOG CALL: Steady to somewhat higher. Given that packers didn't pay much attention to the cash complex late in the week, it's likely that they'll need to be aggressive early next week in the cash sector.

Friday Midday Livestock Market Summary - Northern Feedlots Continue to Hold Out For More Money

GENERAL COMMENTS:

Bids are offered in Nebraska at $308 to $310, but no dressed deals have been reported just yet. Given that feedlot managers have waited this long to trade cattle, it's likely they'll wait however long they need to get the higher money they're after. December corn is down 8 3/4 cents per bushel and December soybean meal is down $2.70. The Dow Jones Industrial Average is up 731.38 points.

LIVE CATTLE:

The live cattle complex has traded mostly mixed ahead of Friday's noon hour, but as the market gets closer and closer to the day's midpoint, traders have let all but the August live cattle contract turn higher. August live cattle are down $0.15 at $188.72, October live cattle are up $0.05 at $188.65 and December live cattle are up $0.32 at $189.22. It makes perfect sense why traders are somewhat leery about advancing the futures complex any more as on Thursday they moved the spot October contract to the highest price point its traded since last October. But as traders continue to see the resilient attitude of feedlot managers in the North hold out and "keep their cool" as they wait for packers to up their bids, traders are excited at the prospect of Northern dressed cattle trading higher. A few bids are currently on the table in Nebraska at $308 to $310, but thus far no cattle have traded in the North. On Thursday live sales were reported in the South at $190, which is $2.00 higher than last week's weighted average. Packer interest should improve as the day trades on.

Boxed beef prices are higher: choice up $2.01 ($314.47) and select up $2.99 ($298.10) with a movement of 47 loads (24.25 loads of choice, 3.99 loads of select, 8.92 loads of trim and 9.72 loads of ground beef).

FEEDER CATTLE:

Even though the live cattle complex is mixed, the feeder cattle complex has elected to keep with its fully higher trend as traders see the support in the fed cash cattle market to be extremely supportive and as they continue to see aggressive buyer demand in the countryside for feeders. August feeders are up $1.00 at $259.62, September feeders are up $1.35 at $259.25 and October feeders are up $1.12 at $258.20. Continuing to see the spot August contract trade above the market's 40- and 100-day moving averages is a strong technical indicator of trader buy-in and support.

LEAN HOGS:

With pork cutout values trading slightly higher at midday, the lean hog complex has found enough support in Friday's market to keep prices trading merely sideways. August lean hogs are down $0.05 at $93.72, October lean hogs are up $0.45 at $78.25 and December lean hogs are up $0.27 at $70.22. It is somewhat encouraging to see the futures complex trading sideways as traders could have just as easily let the market drift fully lower ahead of the weekend. Traders are patiently waiting to see what continues to develop with the market fundamentally as seasonal pork demand has increased, but they continue to question if the seasonal demand is enough support to justify higher technical trade.

The projected CME Lean Hog Index is delayed from the source. Hog prices on the Daily Direct Morning Hog Report average $82.13, ranging from $76.00 to $85.00 on 1,045 head and a five-day rolling average of $83.66 Pork cutouts total 175.33 loads with 158.25 loads of pork cuts and 17.08 loads of trim. Pork cutout values: up $0.27, $106.22.

Friday Morning Livestock Market Update - Traders Wait For Northern Dressed Trade

GENERAL COMMENTS:

Traders were surprised at Southern cattle trading $2.00 higher Thursday. The consensus had been that cash would be no better than steady this week. The weakness of boxed beef again this week and some cattle that were already purchased ahead did not impact cash business Thursday. Northern dressed trade will be the key to whether live cattle futures will see further strength Friday. Futures have already adjusted to the higher cash. Weekly export sales of 13,400 metric tons (mt) were lower than the previous week. The June Cold Storage report did not show any large change in inventory, leaving the report neutral to the market. Boxed beef prices were mixed with choice down $0.22 and select up $1.15. Feeder cattle followed the lead of live cattle but without much conviction. Feeder cattle auction prices have been variable.

Hog futures took a breather Thursday after initially pushing higher. Optimism remains in the market as demand has improved. Cutouts increased $1.19, supported by the increase in butts of $6.48. The supply of pork bellies in cold storage in June was 14% lower than in June 2023. Total pork in cold storage was 3% below a year ago. The report was neutral to the market. Weekly export sales were stronger with an increase of 28% from the previous week. The National Direct Afternoon Hog report showed a decline of $0.79 after buyers had been aggressive earlier in the week. Cash is expected to be lower Friday as clean-up purchases will take place.

	BULL SIDE		BEAR SIDE
1)	The $2.00 higher cash cattle trade in the South should provide more support to the market. Northern dressed trade may follow suit.	1)	Live cattle futures carry no premium to cash and will rise and fall accordingly. This is unusual and indicates the caution held by traders.
2)	August live cattle futures have moved closely with cash and should remain supported. The August, October, and December futures only vary by $0.30, leaving the rest of the year close to the current cash price.	2)	The recent weakness of boxed beef is expected to continue as the summer progresses and lackluster demand continues.
3)	Hog futures made another high Thursday, keeping the uptrend intact. A price correction is beneficial to a trending market.	3)	Hog futures have had a substantial run higher and may see a price correction at the end of the week.
4)	Pork cutouts have been strong, indicating demand is good. Hog buyers have been more aggressive with their purchases to keep plants running full.	4)	The August and October hog contracts have a chart gap below the market that may be filled on a price retracement. Chart gaps generally are filled before the end of the contract.

Thursday Closing Livestock Market Update - Southern Live Cattle Trade for $190, $2.00 Higher than Last Week

GENERAL COMMENTS:

It was an exciting day for the cattle complex as both the live cattle and feeder cattle markets traded higher thanks to the added support of the cash cattle market, and upon seeing boxed beef prices print higher. Some light trade has been reported in the South at $190 which is $2.00 higher than last week's weighted average, but still no dressed trade has developed. December corn is up 2 3/4 cents per bushel and December soybean meal is up $8.60. The Dow Jones Industrial Average is up 81.20 points.

Thursday's export sales report shared that beef net sales of 13,400 metric tons (mt) for 2024 were down 13% from the previous week and 4% from the prior 4-week average. The three primary buyers were South Korea (4,400 mt), Japan (2,200 mt) and China (1,800 mt). Pork net sales of 30,200 mt for 2024 were up 28% from the previous week but down 19% from the prior 4-week average. The three primary buyers were Mexico (7,700 mt), South Korea (6,400 mt) and Japan (4,500 mt).

Thursday's Cold Storage report shared that total red meat supplies in freezers were down 2% from the previous month and down 2% from last year. Total pounds of beef in freezers were down 3% from the previous month and down slightly from last year. Frozen pork supplies were down 2% from the previous month and down 3% from last year. Stocks of pork bellies were down 16% from last month and down 14% from last year.

LIVE CATTLE:

It was a stellar day for the live cattle complex as the spot October contract closed at its highest price point since last October, boxed beef prices saw some better consumer interest and cash prices in the South were noted at $190 which is $2.00 higher than last week's weighted average. It's extremely encouraging that the cash cattle market was able to see prices trend higher than a week ago which leads to the logical question of: Are packers shorter bought than assumed? Last week's Cattle on Feed report shared that the country has more cattle on feed than compared to a year ago, but the cash cattle market seems to be telling a different story as packers and feedlot managers are going head-to-hear nearly each and every week. August live cattle closed $2.00 higher at $188.90, October live cattle closed $2.32 higher at $188.60 and December live cattle closed $1.62 higher at $188.90. No trades have been reported yet in the North, but with the Southern plains able to push prices $2.00 higher, steady trade should be their "worst-case-scenario". 

Thursday's slaughter totaled 120,000 head -- 5,000 head more than a week ago and 4,000 head less than a year ago.

Boxed beef prices closed mixed: choice down $0.22 ($312.46) and select up $1.15 ($295.11) with a movement of 131 loads (77.17 loads of choice, 29.58 loads of select, 6.79 loads of trim and 17.21 loads of ground beef).

FRIDAY'S CATTLE CALL: Steady/somewhat higher. With Southern feedlots able to push the cash market $2.00 higher, it's anyone's guess at this point what the North's cash market will be able to pull off, but higher trade isn't out of the question.

FEEDER CATTLE:

The feeder cattle complex rallied all throughout Thursday's trade as traders were well supported by the market's higher note in the fed cash cattle sector, and by the live cattle market's higher close. August feeders closed $1.50 higher at $258.62, September feeders closed $1.20 higher at $257.90 and October feeders closed $0.70 higher at $257.07. From a technical standpoint it was exciting to see the market (the spot August contract) close above its 40-day and 100-day moving averages which has been a resistance level that the market has struggled with as of late. At Winter Livestock Auction in Pratt, Kansas, compared to last week steers and heifers weighing 400 to 950 pounds sold $7.00 to $10.00 higher. Slaughter cows sold steady to $2.00 lower, and slaughter bulls traded steady. Feeder cattle supply over 600 pounds was 90%. The CME feeder cattle index 7/24/2024: up $0.67, $259.06.

LEAN HOGS:

Even though pork cutout values closed higher, and the morning's export report was fairly supportive, the lean hog complex endured some technical exhaustion on Thursday. The nearby contracts closed slightly lower but the deferred contracts in 2025 where able to keep their higher tone through closing. It's likely that traders want to reassess their immediate direction and probably won't drastically do anything with the complex ahead of next week. August lean hogs closed steady at $93.77, October lean hogs closed $0.22 lower at $77.80 and December lean hogs closed $0.25 lower at $69.95. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.79 with a weighted average price of $84.51 on 3,165 head. Pork cutouts totaled 304.18 loads with 271.80 loads of pork cuts and 32.38 loads of trim. Pork cutout values: up $1.19, $105.95. Thursday's slaughter is estimated at 475,000 head -- steady with a week ago and 16,000 head more than a year ago. The CME lean hog index 7/23/2024: down $0.69, $90.77.

FRIDAY'S HOG CALL: Lower. Packers rarely show the hog complex much support on Friday which will likely be the case again this week.

Thursday Midday Livestock Market Summary - Cattle Contracts, Boxed Beef Prices Are Higher

GENERAL COMMENTS:

With the cash cattle market holding out hopes for at least steady trade and with midday boxed beef prices higher -- both the live cattle and feeder cattle contracts have regained some excitement. Packer interest should improve throughout the day, but cash trade could be delayed until Friday. December corn is up 3 3/4 cents per bushel and December soybean meal is up $7.50. The Dow Jones Industrial Average is up 498.23 points.

Thursday's export sales report shared that beef net sales of 13,400 metric tons (mt) for 2024 were down 13% from the previous week and 4% from the prior 4-week average. The three primary buyers were South Korea (4,400 mt), Japan (2,200 mt) and China (1,800 mt). Pork net sales of 30,200 mt for 2024 were up 28% from the previous week but down 19% from the prior 4-week average. The three primary buyers were Mexico (7,700 mt), South Korea (6,400 mt) and Japan (4,500 mt).

LIVE CATTLE:

The live cattle complex is rocking and rolling as the market nears Thursday's noon hour. With the contracts comfortably trading anywhere from $1.00 to $2.60 higher, feedlots are beginning to believe they could keep this week's market at least steady in the cash sector. Still no cash cattle trade has developed, but with board remaining supportive, feedlots aren't in any hurry to trade their pens as they know that waiting the week out will likely bode well for them. August live cattle up $1.97 at $188.87, October live cattle are up $2.55 at $188.82 and December live cattle are up $1.92 at $189.17. Asking prices are noted at $190-plus in the South but are still not established in the North. Packer interest could begin to develop later this afternoon, but trade could just as easily be delayed until Friday at this point. And don't glance over the fact that midday boxed beef prices are higher -- which is undoubtedly adding support to Thursday's market as well.

Boxed beef prices closed higher: choice up $0.40 ($313.08) and select up $1.36 ($295.32) with a movement of 71 loads (39.02 loads of choice, 20.66 loads of select, 6.15 loads of trim and 5.57 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is trading right in line with the strong nature of the live cattle market. With midday boxed beef prices higher, all the live cattle contracts higher and with buyer demand still incredibly strong in the countryside -- traders feel supported enough to now have advanced the spot August contract back above the market's 100- and 40-day moving average. August feeders are up $2.50 at $259.60, September feeders are up $1.90 at $258.60 and October feeders are up $1.45 at $257.87.

LEAN HOGS:

After trading higher for nearly the last 10 consecutive days in a row, the lean hog complex's rally has ceased for the time being as most of the contracts are trading slightly lower. August lean hogs are up $0.02 at $93.82, October lean hogs are down $0.52 at $77.50 and December lean hogs are down $0.57 at $69.62. The market seems to be technically exhausted more than anything, as traders are still being well supported given that midday pork cutout values are higher. It is likely the market will keep with this cautious tone through the day as traders reassess their immediate direction.

The projected CME Lean Hog Index for 7/24/2024 is up $0.62 at $91.39, and the actual index for 7/23/2024 is up $0.69 at $90.77. Hog prices are unavailable on the Daily Direct Morning Hog Report. However, we can see that only 127 head have traded and the market's five-day rolling average now sits at $83.74. Pork cutouts total 154.68 loads with 140.87 loads of pork cuts and 13.82 loads of trim. Pork cutout values: up $2.33, $107.09.

Thursday Morning Livestock Market Update - Cash Cattle Trade Expected Today

GENERAL COMMENTS:

Cash cattle trade did not surface Wednesday even though some business took place on Tuesday. It is uncertain whether the few cattle that traded $1.00 lower on Tuesday had set the stage for the rest of the week. Cash activity is likely to surface Thursday. Feedlots may not want to hold out until the last minute and then find out they may need to hold market-ready cattle over another week. The pressure continued on boxed beef prices Wednesday with choice down $0.53 and select down $2.70. The continued weakness of boxed beef may leave packers unwilling to bid higher for cattle. Feeder cattle futures eliminated Tuesday's gains and contracts were unable to find support

Hog futures continue to grind higher with the August contract closing at the highest level since June 4 and later contracts at the highest level in a little over a month. Further gains are expected as both cash and cutouts continue to show strength. The National Direct Afternoon Hog report showed cash up $0.95. It is unusual to see cash hogs trade higher on a Wednesday. The packers may be less aggressive Thursday as they may have sufficient supply purchased for the week. Pork cutouts showed further strength, posting a gain of $1.26. The uptrend may remain intact if there is a good weekly export sales report Thursday,

	BULL SIDE		BEAR SIDE
1)	Cattle futures have maintained a sideways pattern, even though boxed beef prices have been eroding over the past few weeks. Demand is expected to hold and increase over time.	1)	Cattle futures are struggling to maintain support due to the continued weakness of boxed beef prices. Consumer demand for beef is good, but not good enough.
2)	Cattle supplies are tight and are expected to remain that way into next year. The current futures contracts are reflecting that.	2)	If cash cattle trade lower this week, futures could break below the sideways trading range and trigger long liquidation.
3)	Hog futures continue to increase, supported by cash and cutouts. Demand for pork has improved, resulting in packers being more aggressive.	3)	The rebound of hog futures may have been too aggressive and may run out of steam shortly with the market finding a level of balance with fundamentals.
4)	The weekly hog weights declined 1.1 pounds last week to an average of 283.6 pounds.	4)	Hog weights remain 5.1 pounds higher than a year ago, keeping plenty of pork available. Packers have sufficient supply available to satisfy the strong slaughter pace.

Wednesday Closing Livestock Market Update - Lean Hog Prices Gain on Higher Cutouts; Cattle Prices Mixed

GENERAL COMMENTS:

October lean hogs closed at a new one-month high Wednesday, helped by the highest pork cutout values since August 2023. October live cattle started the day lower, but finished slightly higher, waiting for cash trade to develop.

LIVE CATTLE:

October live cattle prices dipped early and then came back to end up $0.15 at $186.27 Wednesday, nudging back higher, close to their highest October prices on record. Except for light trade in Kansas at $187 on Tuesday, cash trade remains quiet and may not develop until Friday.

Overall, consumer demand for beef has been supportive this summer, but there is a chance boxed beef prices have seen their peak. Wednesday afternoon's USDA report showed choice boxed beef prices down 53 cents at $312.68 and selects down $2.70 at $293.96 with 188 total loads. Last week's slower slaughter pace appears to be repeating again this week. USDA estimated Wednesday's slaughter at 122,000, up from 121,000 last week. Technically speaking, October live cattle remain in an uptrend with support at $181.72 and are challenging their highest October prices on record.

THURSDAY'S CATTLE CALL: Steady with uncertainty over this week's cash trade.

FEEDER CATTLE:

August feeder cattle traded lower out of the gate and ended down $1.62 at $257.12 Wednesday but is still within its sideways trading range. A breakout above $264 or below $253 would set a new trend, but until then, prices remain confined by a large symmetrical triangle that goes back to September 2023.

On one hand, the year started with 13.3 million calves in U.S. inventory, the lowest number in decades. Feeder prices achieved record highs in May, but it is difficult to say calf numbers have increased significantly. Pasture conditions have been better in the western Plains this year, but there is not much sign of heifer retention yet.

Noncommercials are net short in feeders, hoping for a sell-off, but the cash side of feeder prices has been holding firm. On Wednesday afternoon, the CME Feeder Index was quoted at $257.74 as of Monday, down $3.63 from a week ago, but slightly above Wednesday's close in the August contract.

LEAN HOGS:

October lean hogs recovered from a quick dip early Wednesday and finished up $0.90 at $78.02, the seventh consecutive higher close and another new one-month high. The sudden bullish reversal since early July is similar to a quick U-turn prices made in May 2023. In both instances, attempts to trade below $70 were quickly rebuffed as being too cheap.

Thanks for hogs' higher prices this month can go to consumers, lifting cutout values to their highest level since August 2023. Wednesday afternoon's report daily pork report showed pork cutouts up $1.26 at $104.76, giving packers good reason to keep buying hogs. Wednesday's gains in hams, bellies, loins and picnics more than offset losses in ribs and butts.

Along with the higher cutouts, USDA's daily direct report showed the price of national negotiated hogs increased to $85.30, while formula prices slipped back to $89.82. On Wednesday afternoon, the CME's Lean Hog Index was projected at $90.77 as of Tuesday, up $1.97 on the week.

So far in 2024, hog slaughter has remained consistent, up 1.1% from a year ago. On Wednesday, USDA estimated hog slaughter at 479,000, the same as a week ago. Technically speaking, October lean hogs are in the process of posting a bullish monthly reversal from a cheap price with help from improved retail demand.

THURSDAY'S HOG CALL: Steady with support from firm cash prices.

Wednesday Midday Livestock Market Summary - Prices Mixed

GENERAL COMMENTS:

August feeder cattle are trading lower at midday Wednesday, but remain in a sideways trading range while October live cattle are modestly lower. October lean hog futures continue to extend their highest prices in a month with support from higher pork cutouts.

LIVE CATTLE:

October live cattle futures are trading up $0.65 at $185.47, down a little from their highest prices in four months and backing down from challenging the highest October prices on record. The market will need a strong reason to keep going higher from here and one of the arguments is that even at this level, futures prices are $7 below the price of live steers in the five-state area. Arguing a more cautious future, there is reason to expect seasonal pressure toward fall, the slaughter pace has slowed and boxed beef prices may have seen their peak for the year. Limited trade was reported in Kansas at $187 Tuesday, but it may not be indicative of how prices will look later this week.

In the bigger picture, retail beef demand remains in good shape, but the seasonal trend appears to have peaked. USDA's report on Wednesday morning showed choice boxed beef up $0.09 at $313.30 and selects down $1.65 at $295.01 with 125 total loads. Cattle slaughter in 2024 is down 4.5% from a year ago, the result of fewer cattle available. The slaughter pace was active until recently, but has now slowed. The first two days of this week show 238,000 head slaughtered, slightly below last week's pace that only saw 584,000 slaughtered. Dow Jones estimated cattle slaughter at 122,000 for Wednesday, up from 121,000 a week ago.

Friday morning's radar is mostly clear with hot temperatures expected to stress livestock in the western Plains the next couple weeks or more. Overall pasture conditions are better in the western Plains than a year ago so some herd expansion is possible this year, but to date there have been there have been no strong signs of heifer retention.

FEEDER CATTLE:

August feeder cattle are trading down $2.00 at $256.75, staying within the confines of a symmetrical triangle formation that goes back to September 2023. Technically speaking, a breakout above $264.00 or below $253.00 would suggest the emergence of a new trend in the same direction. Fundamentally speaking, the August futures price is near the CME Feeder Index at $256.67 and appears to be struggling to go much higher, unable to show the same bullish enthusiasm we saw earlier this year.

As mentioned above, better pasture conditions in the western Plains and cheaper hay prices are supporting this year's calf crop, but USDA's latest on-feed report showed no significant drop in the number of heifers put on feed.

LEAN HOGS:

October lean hogs are trading up $0.52 at $77.65, continuing to push higher after reversing direction earlier this month. It is interesting how this month's bullish reversal of direction closely matches the sharp upturn seen in May 2023, the last time October prices tried to trade below $70.00. The odd thing about this month's reversal is that we still see national negotiated hog prices at $84.74 Wednesday morning, trading below formula prices at $90.39. Both prices, however, are higher this week, while demand is being helped by the highest cutout prices since August 2023, quoted at $103.71 on Wednesday morning on 152.23 loads. Higher prices of loins and bellies were offsetting lower prices of ribs and hams. Also reflecting firm cash prices, the CME Lean Hog Index was projected at $90.08 for Monday, up $1.46 from a week ago.

So far in 2024, hog slaughter is up 1% from a year ago, keeping a fairly consistent pace. So far this week, slaughter totaled 934,000, down from 955,000 last week. For Wednesday, Dow Jones' estimated hog slaughter at 482,000, up from 478,000 a week ago.

Wednesday Morning Livestock Market Update - Markets Continue to Adjust to Fundamentals

GENERAL COMMENTS:

Traders became more confident cash cattle might trade higher this week, causing the market to reduce the discount they were holding to cash. Steady cash trade this week would be considered friendly to the market. Packers have some cattle purchased ahead, which may leave them less willing to match the higher offers of feedlots. Some limited cash trade was seen in Kansas at $1.00 lower than last week. This does raise some concern as continued lower boxed beef prices may be the deciding factor. Tuesday's boxed beef prices were lower with choice down $0.23 and select down $1.67. This may cause the packers to hold the line on what they are willing to pay for cattle.

Hogs continued to uncover buying interest, finding continued support from market fundamentals. The market has far surpassed the three-day fund short-covering period that turned the market from its low. Pent-up optimism was evident when the market opened Tuesday and the August and October contracts gapped higher. Strength may continue Wednesday but with less exuberance. The National Direct Afternoon Hog report showed cash up by $0.31 with packers expected to be less aggressive Wednesday. Cutout values declined $1.02 but the impact on the market is expected to be minimal.

	BULL SIDE		BEAR SIDE
1)	The uptrend in live cattle futures remains intact with traders optimistic cash prices will remain strong with no worse than steady cash this week.	1)	The choice boxed beef price fell $8.23 last week with further weakness expected through the end of this week. This may put additional pressure on the cash cattle market.
2)	The Cattle on Feed report showed that heifer retention is not increasing, much delaying the rebuilding of the herd.	2)	Cattle weights were higher last week with the average dressed steer weights up five pounds from the previous week. Feedlots may be willing to move cattle this week and unwilling to hold and continue to feed for no financial benefit.
3)	The hog market fundamentals have turned bullish, triggering short-coving and renewed buying interest and quickly eliminating the oversold condition of futures.	3)	August and October hog futures gapped higher on the open. Those gaps may be filled at some point.
4)	Pork cutout prices have been increasing, indicating demand is improving. Packers will need to remain aggressive with hog purchases to keep plants full and demand satisfied.	4)	Hog futures have corrected from their oversold condition, which may temper some of the strength as the market finds a fundamental balance.

Tuesday Closing Livestock Market Update - Traders Continue to Push the Complex Higher

GENERAL COMMENTS:

It was another day of higher closes for the livestock complex as traders support the contracts all the way through the day's end. But heading into Wednesday's market, there will be more at stake for traders to sort through as they'll be watching to see if anything develops in the cash market, if pork cutout values continue to support or not and if feeders can take on the market's resistance and it's 100-day and 40-day moving averages. December corn is up 2 1/4 cents per bushel and December soybean meal is down $0.30. The Dow Jones Industrial Average is down 57.35 points.

LIVE CATTLE:

The live cattle complex was comfortable trading higher in its current sideways trading range as the market expects that feedlots are going to price their showlists higher this week. A few early bids surfaced this afternoon at $187 to $188 live in the South, but with Southern feedlots asking $190, most feedlots elected to let that offer sit on the table. But there was a handful of cattle that did trade in Kansas at $187, which is about $1.00 lower than last week's weighted average. Asking prices in the North remain elusive at this point. Some trade could begin to develop on Wednesday if prices in the Southern plains get stronger, but so long as the board continues to show support, it's likely that feedlots will be willing to wait the week out for the money they desire. August live cattle closed $2.37 higher at $186.30, October live cattle closed $1.52 higher at $186.12 and December live cattle closed $1.37 higher at $187.40. 

Tuesday's slaughter is estimated at 123,000 head -- 2,000 head more than a week ago but 2,000 head less than a year ago.

Boxed beef prices closed lower: choice down $0.23 ($313.21) and select down $1.67 ($296.66) with a movement of 165 loads (97.19 loads of choice, 40.96 loads of select, 13.22 loads of trim and 13.59 loads of ground beef).

WEDNESDAY'S CATTLE CALL: Steady. Given that the board has been very supportive this week, it's likely that feedlots will price their cattle higher this week and aim for steady prices.

FEEDER CATTLE:

The feeder cattle complex sported a strong rally through Tuesday's end as traders went head-to-head with the market's 100-day and 40-day moving average at closing. August feeders closed $2.35 higher at $258.75, September feeders closed $2.10 higher at $258.60 and October feeders closed $2.17 higher at $258.42. At Wednesday's start the market will be pressured to either continue with its rally or submit to the market's nearby resistance at those moving averages and either turn lower or chop sideways. Much of the feeder cattle market's attitude on Wednesday will depend on how the live cattle complex trades and whether or not it receives any trickle-down support. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week feeder cattle and calves sold steady to $4.00 higher. Feeder cattle supply over 600 pounds was 58%.

LEAN HOGS:

Even though pork cutout values ventured lower this afternoon, the lean hog contracts were still able to round out the day on a higher note. August lean hogs closed $1.27 higher at $93.65, October lean hogs closed $1.15 higher at $77.12 and December lean hogs closed $1.47 higher at $69.42. Packers did show a little more interest in this afternoon's cash market, but it's likely that they'll need to be even more aggressive on Wednesday given the processing speeds in which the market has currently been running. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.31 with a weighted average price of $84.35 on 5,825 head. Pork cutouts totaled 312.90 loads with 277.13 loads of pork cuts and 35.76 loads of trim. Pork cutout values: down $1.02, $103.50. Tuesday's slaughter is estimated at 481,000 head -- 4,000 head more than a week and a year ago. The CME lean hog index 7/19/2024: up $0.09, $89.80. The CME feeder cattle index 7/22/2024: up $1.07, $257.74.

WEDNESDAY'S HOG CALL: Steady. Hog prices could hold steady or even potentially trend higher, but hog producers are hoping that the day's volume is larger than the 5,000 head sold this afternoon.

Tuesday Midday Livestock Market Summary - Traders Continue to Advance the Contracts

GENERAL COMMENTS:

It's another prosperous day for the livestock industry as all three of the markets are trading higher into Tuesday's noon hour. Still no cash cattle trade has developed, and it's not likely that any does until Wednesday at the absolute earliest. December corn is up 4 1/4 cents per bushel and December soybean meal is up $1.50. The Dow Jones Industrial Average is up 86.06 points.

LIVE CATTLE:

The live cattle complex is keeping with Monday's higher trend as all of the live cattle contracts continue to trade higher. The cash cattle complex hasn't been able to add any additional support at this time given that no cattle have sold yet, but with the board's encouragement, there's a chance that cattle trade at least steady this week. Bids and asking prices remain elusive at this point, and it's not likely that any trade will develop ahead of Wednesday. August live cattle are up $1.40 at $185.32, October live cattle are up $0.92 at $185.52 and December live cattle are up $0.77 at $186.80.

Boxed beef prices are mixed: choice up $0.35 ($313.79) and select down $0.18 ($298.15) with a movement of 83 loads (44.75 loads of choice, 22.70 loads of select, 7.65 loads of trim and 8.14 loads of ground beef).

FEEDER CATTLE:

With the live cattle complex trading higher and with feeder cattle demand remaining unbelievably strong in the countryside -- it's been an easy option for the feeder cattle contracts to decide to continue to trade higher thus far through Tuesday's trade. August feeders are up $1.72 at $258.02, September feeders are up $1.42 at $257.92 and October feeders are up $1.45 at $257.70. The spot August contract is close to reaching the market's 100-day and 40-day moving average points, which could add some technical resistance to the market, but at this point traders don't seem concerned with the nearing resistance plane.

LEAN HOGS:

The lean hog complex is once again celebrating as the market is keeping with its upward trend despite midmorning pork cutout values being slightly lower. Given that the trend in pork demand has shifted domestically as now consumers are showing more eagerness to pick up pork cuts at the retailor counter, traders are confidently advancing the market out of the hole it dug starting earlier this spring. August lean hogs are up $1.30 at $93.67, October lean hogs are up $1.27 at $77.25 and December lean hogs are up $1.35 at $69.32.

The projected lean hog index for 7/22/2024 is up $0.28 at $90.08, and the actual index for 7/19/2024 is up $0.09 at $89.80. Hog prices are lower on the Daily Direct Morning Hog Report, down $0.66 with a weighted average price of $83.18, ranging from $79.50 to $85.00 on 1,282 head and a five-day rolling average of $83.84. Pork cutouts total 185.57 loads with 161.95 loads of pork cuts and 23.63 loads of trim. Pork cutout values: down $0.39, $104.13.

Tuesday Morning Livestock Market Update - Hog Futures Hold Further Upside Potential

GENERAL COMMENTS:

With the numbers on the Cattle on Feed report known, traders decided the placement number should be the focus and provide support to the market. The supply of cattle will be tight the rest of the year and the potential for increased demand once the summer is over may provide renewed support for the market. Beef demand has slowed and has been reflected in the boxed beef prices over the past few weeks. Boxed beef on Monday was lower with choice down $0.39 and select down $0.47. Lower boxed beef prices have been the trend recently. The packers have been reducing the slaughter pace, attempting to improve their margins, but they have not made much progress in that direction as boxed beef prices continue to weaken. The early anticipation is for cash cattle to trade at steady money this week.

The recent rally in hog futures has been long overdue from a technical standpoint. Fundamentally, demand seems to have turned a corner as cutout values have been improving. Cutouts on Monday showed an increase of $2.01 from the previous day. The National Direct Afternoon Hog report showed a surprising increase of $1.62. It is unusual to see a strong cash market at the beginning of the week. The packers may remain aggressive Tuesday as they may want to purchase hogs early rather than wait until later in the week.

	BULL SIDE		BEAR SIDE
1)	The lighter cattle placements in June seem to be the focus of traders and should provide further support to the market.	1)	Packers have cattle purchased ahead, which may leave them less aggressive in the cash market again this week. Prices may be no better than steady.
2)	The cattle market is maintaining a sideways trading pattern during which it may build support. Strong beef demand is expected to resume after the summer months.	2)	Cattle futures have not been able to trend higher, but have been trading sideways. The top may have been established.
3)	Hog futures have corrected from being oversold. Fund traders have been short-covering and the higher trend should trigger more stops and higher prices.	3)	Traders will be cautious over continued pork demand. This may limit the upside price potential.
4)	Pork cutout values have been increasing as demand has increased. This should further support the market.	4)	Hog futures indicate the idea there will be a significant decline in hog prices as the year progresses. The October contract holds a discount of about $17.00 with December holding a $25.00 discount.