GENERAL COMMENTS:
The livestock complex is trading mostly lower into Monday's noon hour as traders remain skeptical of doing too much in the commodity markets while external pressures loom. However, if consumer demand shows enough support this week, the contracts could turn higher. December corn is up 4 3/4 cents per bushel and December soybean meal is down $5.80. The Dow Jones Industrial Average is down 84.72 points.
LIVE CATTLE:
Traders are carefully dipping their toes into the live cattle market this week as they allow the complex to trade steady to somewhat lower at Monday's start following Friday's late-week advancement. August live cattle are down $0.75 at $183.50, October live cattle are down $0.45 at $180.67 and December live cattle are down $0.10 at $179.50. If boxed beef prices lend enough support and if the cash cattle market could trade steady, there's a chance the futures complex could regain some position. But more than anything traders will most likely be cautious market participants this upcoming week as they're still concerned about external pressures -- the economy, increasing tensions between Iran and Israel, and typical election jitters.
Last week Southern live cattle traded for mostly $186 to $187 which is $1.00 to $2.00 lower than the previous week's weighted average. Northern dressed cattle traded for mostly $305, which is $5.00 lower than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 76,196 head. Of that 69% (52,592 head) were committed to the nearby delivery, while the remaining 31% (23,604 head) were committed to the deferred delivery.
Monday's WASDE report was supportive to both the cattle and beef markets. Beef production for 2024 was raised by 81 million pounds as production of fed steers and heifers and cows is expected to be stronger in the second half of the year than originally anticipated. Feedlot operators should be encouraged by the forecast in quarterly steer prices as in 2024, steer prices are expected to average $193 (up $3.00 from last month), and in the fourth quarter steers prices are expected to average $190 (up $2.00 from last month). Steer prices in the first quarter of 2025 are expected to average $189 (up $1.00 from last month) and the second quarter is expected to average $190 (which is unchanged from a month ago). 2024 beef imports were raised by 42 million pounds, but beef exports for 2024 were also increased 32 million pounds as global demand remains strong.
Boxed beef prices are higher: choice up $2.51 ($315.22) and select up $1.32 ($299.91) with a movement of 46 loads (29.33 loads of choice, 10.11 loads of select, zero loads of trim and 6.34 loads of ground beef).
FEEDER CATTLE:
After rallying late last week, the feeder cattle complex is again trading lower at Monday's start. August feeders are down $1.82 at $244.67, September feeders are down $1.12 at $240.45 and October feeders are down $1.25 at $238.52. It's likely the complex will continue to trade in a slightly lower manner until either the live cattle contracts lend sufficient support, or until the cash cattle market offers support; either way, neither of those markets are expected to turn higher before Monday's close.
LEAN HOGS:
With midday pork cutout values higher, there's a chance the lean hog complex could end up trading higher later this week if support remains prevalent in the days to come. At this point in time, the market is trading mostly lower as traders need to see more fundamental reassurance before they'll fully commit to trading the complex higher. October lean hogs are up $0.32 at $74.30, December lean hogs are down $0.15 at $66.15 and February lean hogs are down $0.42 at $69.45.
The projected CME Lean Hog Index is delayed from the source. Hog prices are unavailable on the daily Direct Morning Hog Report because of packer submission issues. Pork cutouts total 191.55 loads with 165.93 loads of pork cuts and 25.62 loads of trim. Pork cutout values: up $2.20.
Monday's WASDE report was a mixed report for both the pork and hog markets. 2024 pork production was decreased by 91 million pounds as slaughter speeds are expected to be reduced in the third quarter and dressed weights are projected to be lighter as well. Quarter price projections were a mixed bag for the hog complex as prices in the third quarter of 2024 are expected to average $63 (which is unchanged from a month ago), but prices in the fourth quarter are expected to average $53 (up $1.00 from last month). Unfortunately price projections for 2025 were decreased as the first quarter of 2025 is expected to average $55 (down $1.00) and the second quarter of 2024 is expected to average $61 (down $1.00). 2024 pork imports were decreased by 25 million pounds, but pork exports also fell by 125 million pounds.
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