GENERAL COMMENTS:
It was a mixed day for the livestock complex as traders began to become cautious in the live cattle complex as they're yearning to see what the cash cattle market does. But both the lean hogs and feeder cattle markets were able to close mostly higher. December corn is down 2 cents per bushel and December soybean meal is down $3.90. The Dow Jones Industrial Average is down 159.08 points.
LIVE CATTLE:
The live cattle complex was a dud throughout the day as traders weren't willing to advance the market any more ahead of seeing what cash cattle prices are going to do this week. October live cattle closed $0.77 lower at $178.62, December live cattle closed $1.07 lower at $177.77 and February live cattle closed $0.52 lower at $178.97. It's anyone's guess at this point what the cash cattle market is going to do this week. Feedlot managers are hopeful that they'll be able to trade cattle at steady money, but packers are going to point to the recent dip in boxed beef prices as a reason why prices could continue to trend lower. Still no bids or asking prices have been posted, but packer interest will likely improve on Thursday although trade could still potentially delayed until Friday.
Wednesday's slaughter is estimated at 120,000 head -- 2,000 head less than a week ago and 3,000 head less than a year ago.
Boxed beef prices closed lower: choice down $4.68 ($307.29) and select down $2.62 ($297.63) with a movement of 124 loads (85.25 loads of choice, 19.86 loads of select, 3.36 loads of trim and 15.90 loads of ground beef).
THURSDAY'S CATTLE CALL: Steady to $1.00 lower. With next week's kill schedule shorted because of Monday's holiday, feedlots are going to have to work extra hard if they're going to secure steady cash prices this week.
FEEDER CATTLE:
It was interesting to watch the feeder cattle complex trade throughout Wednesday's market. Even though the live cattle complex closed lower, the feeder cattle contracts were able to keep their deferred contracts trading higher through the day's end, but the nearby contracts followed more in line with what the live cattle market did. But even though the nearby contracts closed slightly lower, today's weaker note in the soon-to-be-expiring August contract and the September contract weren't major moves -- more so a pause in the market's upward trek as traders are waiting to see what the fed cash cattle market does. As a side note, it was encouraging to see feeder cattle prices trade higher at Dodge City – which indicates that buyers are still in the game despite whatever the board does. September feeders closed $0.62 lower at $241.30, October feeders closed $0.20 higher at $238.57 and November feeders closed $0.10 higher at $236.37. At Winter Livestock Auction in Dodge City, Kansas, compared to last week feeder steers under 500 pounds were not well tested, but steers weighing 650 to 800 pounds traded $3.00 higher while steers over 800 pounds sold $5.00 higher. Heifers under 500 pounds were well tested either, but heifers over 500 pounds all traded $3.00 higher. Slaughter cows and bulls traded $3.00 lower. Feeder cattle supply over 600 pounds was 96%. The CME feeder cattle index 8/27/2024: up $0.01, $242.64.
LEAN HOGS:
Traders were fully committed to supporting the lean hog complex as the market didn't receive much fundamental support throughout Wednesday's trade. I'm surprised to see that less than 3,000 head of hogs traded throughout the day -- but with next week's market shortened because of the Labor Day holiday, there's a chance that packers simply don't need to procure as many hogs this week. October lean hogs closed $0.40 lower at $81.67, December lean hogs closed $0.27 higher at $71.92 and February lean hogs closed $0.30 higher at $74.50. The afternoon carcass prices were pulled lower as the belly alone closed $5.49 lower, and the butt closed $3.83 lower. Hog prices closed $1.80 lower on the Daily Direct Afternoon Hog Report, equating to a weighted average of $77.75 on 2,615 head. Pork cutouts totaled 238.02 loads with 209.51 loads of pork cuts and 28.52 loads of trim. Pork cutout values: down $0.77, $95.28. Wednesday's slaughter is estimated at 483,000 head -- 2,000 head more than a week ago and 8,000 head more than a year ago. The CME lean hog index 8/26/2024: down $0.04, $87.82.
THURSDAY'S HOG CALL: Lower. There's a chance that packers could be essential done buy this week as they prepare for a short schedule next week.
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