GENERAL COMMENTS:
Strong triple-digit gains quickly held in all cattle futures with feeder cattle futures leading the upward charge Friday. January through April feeder cattle contracts were the target markets with traders not only looking at current short-term support in the complex but the potential ability to sustain current market support well into the spring months of 2025. Live cattle futures gained late-week momentum based on this renewed buyer support with all contracts through the winter and spring holding triple-digit gains at the end of Friday's trading session. Lean hog futures ended higher but were much less aggressive with limited support seen during 2025 contract months as traders remain much more cautious about upward price potential in hog and pork prices. Hog prices closed lower on the Daily Direct Afternoon hog report, down $4.10 with a weighted average of $72.05 on 1,498 hogs. December corn closed down 2 at $4.048 and December soybean meal closed down $2.50 at $315.6. The Dow Jones Industrial Average is up 36.86 at 43,275.91.
LIVE CATTLE:
Live cattle futures bounced higher Friday, following the ability to move away from short-term support levels earlier in the week. Even though spot month October contracts are still hovering below resistance levels of $189.17 per cwt, the potential for increased buyer support remains strong based on continued firmness in beef values and the ability for consistent buying activity to redevelop across the complex. All nearby contracts posted strong gains with October futures closing $1 per cwt higher at $187.62, while December futures held at $1.15 per cwt rally, closing at $187.32 per cwt. All contracts through April 2025 are now trading above $185 per cwt, helping to add even more support to the underlying tone of the live cattle complex. Cash cattle markets are showing a handful of sales reported in parts of Texas this morning at $188, steady with yesterday. Following a light to moderate trade that took place in most areas yesterday, with Southern live deals marked at $187 to mostly $188, steady to $1 higher than last week's weighted averages, while Northern dressed sales took place at mostly $296, fully steady with the prior week's weighted averages. In this week's export sales report, Net sales of 14,100 MT for 2024 were up 3 percent from the previous week, but down 9 percent from the prior 4-week average. Increases were primarily for Japan (4,600 MT, including decreases of 200 MT), South Korea (2,600 MT, including decreases of 400 MT), China (2,300 MT, including decreases of 100 MT), Mexico (1,100 MT, including decreases of 100 MT), and Taiwan (700 MT, including decreases of 100 MT). Net sales of 900 MT for 2025 were reported for Japan (600 MT), Hong Kong (100 MT), the Philippines (100 MT), and Guatemala (100 MT). Exports of 15,300 MT were down 5 percent from the previous week and 2 percent from the prior 4-week average. The destinations were primarily to Japan (3,800 MT), South Korea (3,800 MT), China (1,900 MT), Mexico (1,400 MT), and Taiwan (1,000 MT). October live cattle closed $1.00 higher at $187.625, December live cattle closed $1.15 higher at $187.325 and February live cattle closed $1.15 higher at $188.125.
Friday's slaughter is estimated at 106,000 head, 1,000 head less than a week ago and 11,000 head less than a year ago. Saturday runs are expected at 14,000 head, bringing the weekly total to 608,000 head, 22,000 more than the previous week, but 29,000 less than 2023.
Boxed beef prices closed higher: choice up $1.39 ($320.65) and select up $0.68 ($294.2) with a movement of 126.13 loads (83.49 loads of choice, 21.98 loads of select, 5.83 loads of trim and 14.83 loads of ground beef).
MONDAY'S CATTLE CALL: Steady. Cash markets are likely to remain quiet early next week with Monday's activity focused on inventory taking and show list distribution. The ability to continue to support futures prices and beef values may help to bring additional positive movement to cash cattle trade through the end of October.
FEEDER CATTLE:
Feeder cattle futures posted a strong and supportive rally Friday, with all nearby contracts posting triple-digit gains. October futures were the least aggressive contract, closing at $248.32 per cwt following a $1.60 per cwt rally. January through April contracts posted gains over $2 per cwt with renewed commercial buyer support steadily moving into the market at the end of the week. The potential to break away from the selling activity seen earlier in the week could not only help to move prices back above the 40-day moving average, but also move price levels to 2-month highs based on the steady support in live cattle trade and firming cash feeder cattle values. October feeders closed $1.60 higher at $248.325, November feeders closed $1.85 higher at $247.6 and January feeders closed $2.38 higher at $245.5. The CME Feeder Cattle Index for October 16: up $0.55, $250.80.
LEAN HOGS:
Lean hog futures stabilized at the end of the week with very limited, but positive support seen in nearby contracts. The overall support seen over the past couple of weeks in nearby lean hog futures has been impressive, moving prices well above the 40-day moving average through the last month and helping to carve out higher expectations for lean hog and pork prices through the end of the year. December contracts closed 0.15 cent per cwt higher at $77.82 per cwt, with all other nearby contracts posting gains of 30 to 50 cents per cwt and trading above $80 per cwt. The focus on continued seasonal support in the hog market with summer hog prices holding above $95 per cwt is bringing some much sought-after support back to the complex. In this week's export sales report, net sales of 38,100 MT for 2024 were down 25 percent from the previous week, but up 1 percent from the prior 4-week average. Increases were primarily for Mexico (8,900 MT, including decreases of 400 MT), Japan (7,800 MT, including decreases of 1,000 MT), Colombia (5,100 MT, including decreases of 200 MT), South Korea (4,900 MT, including decreases of 200 MT), and Honduras (2,600 MT, including 100 MT switched from the Dominican Republic). Net sales of 800 MT for 2025 were for South Korea. Exports of 34,000 MT were up 49 percent from the previous week and 26 percent from the prior 4-week average. The destinations were primarily to Mexico (20,000 MT), Japan (3,500 MT), China (2,100 MT), Canada (1,800 MT), and South Korea (1,700 MT). December lean hogs closed $0.15 higher at $77.825, February lean hogs closed $0.30 higher at $81.85 and April lean hogs closed $0.50 higher at $85.625. Friday's hog slaughter is estimated at 481,000 head, 3,000 head less than a week ago and even with a year ago. Pork Cutouts totaled 285.31 loads with 248.19 loads of pork cuts and 37.12 loads of trim. Pork cutout values are up $0.18 at $96.59. The CME Lean Hog Index for October 16: down $0.01, $83.84.
MONDAY'S HOG CALL: Steady to $1 Lower. Limited early-week activity is expected in the cash hog markets. The focus on outside markets and the ability to bring additional stability to pork prices may help to stabilize the market as the week continues.
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