Moderate trading developed Friday afternoon in parts of the Northern tier of cattle feeding country. Most dressed sales were marked at $170, $2 lower than last week. On a live basis, steers and heifers in Nebraska and Iowa sold at mostly $107, $2 lower than last Friday. On the other hand, the South remains at a standstill. We can only assume that between contracts and formulas, packers in Kansas and Texas have sufficient numbers to get next week's kill started. The National hog base closed off $0.12 compared with the Prior Day settlement ($34 to $38, weighted average $37.57). From Friday to Friday, livestock futures scored the following changes: Aug LC up $0.55; Oct LC up $2.07; Sep FC up $1.98; Oct FC up $2.40; Oct LH off $1.35; Dec LH up $2.18. Corn futures closed 8 to 10 cents higher, supported by late-month short-covering and commercial-buying. The stock market closed on a mixed basis with the Dow down 22 points and the Nasdaq up 21 points.
Futures closed mostly moderately lower, off 10 to 300. Spot August expired down the limit at high noon, going off the board at $106.80. New spot October will start trade next Tuesday, still trapped in a lateral trading range that has persisted since early April. October has been unable to master overhead resistance near 110 to 111 for months. Beef cutouts: lower to sharply lower (choice, $209.69 off $2.04, select $201.27 off $0.94) on light-to-moderate demand and offerings (32 loads of choice cuts, 27 loads of select cuts, zero loads of trimmings, 24 loads of coarse grinds).
TUESDAY'S CASH CATTLE CALL:
Steady to $2 lower. Post-holiday activity will be limited on Tuesday to the collection of new showlists. We expect ready numbers to be somewhat larger than late August. Positively, cattle buyers will take up the chore of funding the first full slaughter week of September.
Futures closed sharply lower, off 72 to 147. With the exception of spot September all feeder issues settled with triple-digit losses. Commercial buying is no doubt becoming more cautious given deteriorating margins. Furthermore, the feeder board was probably pressured by Friday's strong rally in the corn market. CME cash feeder index: 08/30: $149.98, off $0.11.
Futures closed mostly moderately higher, up 30 to 130. Friday's late-week bounce was supported by short-covering and ideas that post-Labor Day fundamentals could temporarily stabilize. Price history is below examples of improving cash prices in the early fall period, especially in years that saw serious price pressure through the month of August. 2018 certainly seems to qualify in that regard. Yet the ability of late third-quarter pork demand to absorb historically large tonnage could be the key. Pork cutout: $67.21 (FOB Plant) up $0.46. CME cash lean 08/29: $45.85, off $0.60 (DTN Projected lean index for 08/30: $45.63, off $0.22.
TUESDAY'S CASH HOG CALL:
Steady. Look for early week bids to be near steady when trade resumes on Tuesday.