GENERAL COMMENTS:
It was a thrilling day for the livestock complex as the cash cattle market was able to add another $2.00 to its market and both the live cattle and feeder cattle contracts closed higher. Please note that on Friday the month's Cattle on Feed report will be released. December corn is up 2 1/2 cents per bushel and December soybean meal is down $4.60. The Dow Jones Industrial Average is down 140.59 points.
Thursday's export report shared that beef net sales of 16,700 metric tons (mt) for 2024 were up 19% from the previous week and 11% from the prior 4-week average. The three largest buyers were South Korea (6,500 mt), China (4,600 mt) and Taiwan (1,800 mt). Pork net sales of 22,200 mt for 2024 were down 42% from the previous week and 45% from the prior 4-week average. The three primary buyers were Mexico (17,000 mt), China (8,800 mt) and Australia (4,700 mt).
LIVE CATTLE:
What a day it was for the live cattle complex as the market reached a new high for its current move which was largely thanks to the support of the relentless cash cattle market. Shortly after the noon hour, packers began to buy Southern cattle for $190 which is $2.00 higher than last week's weighted average and Northern dressed cattle traded at $298 which is also $2.00 higher than last week's weighted average. It's somewhat surprising to see packers this aggressive in the market given that they've been able to buy some cattle with time in the last two weeks, but with boxed beef prices as high as they are, their margins have obviously improved. It would be remiss of me to also overlook the strategic marketing done by feedlot managers as they've been extremely dedicated to advancing the market and it has paid off 100-fold for them. December live cattle closed $1.37 higher at $189.25, February live cattle closed $1.32 higher at $189.95 and April live cattle closed $1.07 higher at $190.35.
Thursday's slaughter is estimated at 124,000 head -- 6,000 head more than a week ago and 1,000 head less than a year ago.
Boxed beef prices closed lower: choice down $0.24 ($321.17) and select down $1.43 ($294.34) with a movement of 189 loads (132.85 loads of choice, 28.03 loads of select, 6.40 loads of trim and 22.09 loads of ground beef).
FRIDAY'S CATTLE CALL: Steady with the week's trend. Given that cattle have now traded in both regions, it's likely that the week's prices are set.
FEEDER CATTLE:
Following Wednesday's disappointing trade, Thursday ended up being a strong day for the feeder cattle complex as not only did the futures market recover its position lost through Wednesday's trade and continue to see strong technical support, but fundamental demand in the countryside continues to remain incredibly strong. The spot January feeder cattle contract was yet again able to close above its 100-day moving average which traders finally felt supported enough in doing so after seeing the fed cash cattle market trade higher. November feeders closed $1.30 higher at $248.52, January feeders closed $1.70 higher at $245.52 and March feeders closed $1.42 higher at $243.87. At La Junta Livestock Commission in La Junta, Colorado compared to last week steers traded mostly $2.00 to $9.00 higher with instances of sharply higher prices across all weight groups. Feeder heifers sold $4.00 to $11.00 higher with higher instances as well. Feeder cattle supply over 600 pounds was 30%. The CME feeder cattle index: down $1.15, $249.56.
LEAN HOGS:
The lean hog complex wasn't able to round out the day on a higher note as the market wasn't pleased with its weekly export report, and in all fairness, just Wednesday afternoon the spot December contract scored a new contract high so one could argue that unless something substantial developed fundamentally that traders might pull back from Wednesday's sharp advancement. December lean hogs closed $1.52 lower at $78.65, February lean hogs closed $0.60 lower at $82.80 and April lean hogs closed $0.27 lower at $86.25. It didn't help matters either that the afternoon carcass price closed lower which was mostly deflated by the belly's $3.55 drop. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $2.59 with a weighted average price of $75.25 on 1,785 head. Pork cutouts total 337.15 loads with 299.15 loads of pork cuts and 38.00 loads of trim. Pork cutout values: down $0.07, $98.15. Thursday's slaughter is estimated at 487,000 head -- 1,000 head more than a week ago and 5,000 head more than a year ago. The CME lean hog index 10/22/2024: up $0.32, $84.66.
FRIDAY'S HOG CALL: Lower. It's likely that packers have secured the vast majority of their needs for the week.
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