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Friday, September 28, 2018

Friday Closing Livestock Market Summary - Positive Close for Livestock Complex

GENERAL COMMENTS:
Friday-to-Friday livestock futures scored the following changes: Oct LC, up $0.38; Dec LC, up $0.40; Oct FC, up $0.10; Nov FC, up $0.25; Oct LH, up $1.87; Dec LH, up $0.52. Light to moderate cash cattle trade has developed in the South with transactions at $111.00, steady with last week. Trade has also developed in Nebraska at $111.00, up $0.50 from last week's weighted average. Limited gains in futures gave no reason for buyers to become very aggressive. Corn futures fell apart after the Quarterly Stocks report, closing 8 1/2 cents lower. The DOW gained 18 points, closing at 26,458 while the NASDAQ gained 4 points closing at 8,046.

LIVE CATTLE:
Limited gains in futures were posted at the close. Losses dominated a good portion of the day, but steady cash cattle prices were able to provide support. October put in an inside trading day while December closed matching the contract high set on both February 15 and 16, 2018. Beef cut-outs were mixed, down $0.83 (choice, 203.88 and up $0.88 (select $193.44). There were 113 loads reported (45 loads of choice cuts, 11 loads of select cuts, 29 loads of trimmings, and 29 loads of ground beef).

MONDAY'S CASH CATTLE CALL:
Steady to $1.00 higher. The fact that buyers paid steady money may solidify the resolve of sellers and raise asking prices. However, it will just be a formality as cash business is never done at the beginning of the week.

FEEDER CATTLE:
Futures traded similar to live cattle futures, but spent more time in the negative during the day. However, prices were able to come back within striking distance of the daily highs, finishing the week on a positive note. Feeder cattle index for 9/27 is $156.89, down $1.24.

LEAN HOGS:
Triple-digit gains were evident in all contracts with the exception of front-month October. Traders felt more confident buying into futures due to the neutral Hogs and Pigs report, as well as the fact that the report is now old news. The quick reversal from Thursday's decline is technically positive. The National Pork report showed 171 loads of pork cuts and 33 loads of trim for the day. CME cash lean hog index for 9/26 is $65.34, up $1.59. DTN projected lean hog index for 9/27 is $66.45, up $1.11.

MONDAY'S CASH HOG CALL:

Steady to $1.00 higher. Futures should show follow-through, increasing the need to do business at higher prices.

#completecalfcare

Friday Midday Livestock Market Summary - Lean Hogs Rebound On Report

GENERAL COMMENTS:


LIVE CATTLE:

Cattle futures show little to get excited about. October live cattle futures have so far posted an inside trading day while December has made a new higher for this upward move and a new contract high, but has been unable to hold that level. There have been a few bids, but packers continue to wait to the last minute as usual. Asking prices are $114-$115 in the South and $178 in the North. Boxed beef cut-outs are mixed, $0.33 lower (choice) and $1.03 higher (select) with movement of 70 loads reported (29 loads of choice cuts, 8 loads of select cuts, 19 loads of trimmings, and 14 loads of ground beef.

FEEDER CATTLE:
Feeder cattle futures have not been too excited to do much of anything with limited volatility and tight trading ranges. The inability of live cattle to generate much activity has provided little direction or excitement. Minor earlier strength has given way to weakness.

LEAN HOGS:

Lean hog futures show strong gains as traders react to the neutral hogs and pigs report. October futures are $1.32 higher with December $2.52 higher. Futures have regain all of the losses of the past week. The report was neutral with a few indications of some positive numbers for the future. Deferred futures showed nearly as much strength as close months. Cash prices are lower on the National Direct morning report with the weighted average $0.33 lower with a range of $61.00-$63.15 on 5,096 head sold. The National Pork Plant report posted 119 loads selling. Carcass values declined $0.95 per cwt at $79.56.

#completeherdhealth

Friday Morning Livestock Market Update - Hogs Start A Little Higher

GENERAL COMMENTS


LIVE CATTLE:
Open: 7 cents lower. December cattle are down 0.25 early in Friday's session, lightly influenced to the downside by a higher U.S. dollar and lower stock market while traders wait for cash business to develop. This week's boxed beef prices have been roughly steady for choice cuts and down a couple dollars for selects. Also, Thursday's beef exports were neutral at 16,000 mt, so it is difficult to see why the futures are so determined to challenge their highs. Cash cattle are expected to be steady to $1 lower Friday, but have not seen much action yet. It was encouraging to see bids hold at $109 Thursday after news of new trade negotiations with Japan came out. Thursday's open interest increased 666 to 328,583. October contracts dropped 2,737 to 37,537 and December added 1,426 to 123,493. Dow Jones projected cattle slaughter for Friday at 119,000 head, up from 118,150 a year ago. 

FEEDER CATTLE:
Open: Even. November feeder cattle are down 0.40, negatively influence by outside markets early Friday. Among November feeder prices, $161.50 was last year's high and stands as the line of resistance to watch moving forward. In spite of last week's bearish on-feed numbers, price behavior in the futures market continues to suggest that available supplies may be tighter than expected. So far, cattle and feeder prices continue to find support from increased beef demand and a positive outlook for the economy, in spite of this year's trade concerns. The Feeder Cash index for 9/26 is listed at $158.13, up 3.67 from a week ago. Thursday's total open interest increased 620 to 56,103. 

LEAN HOGS:
Open: 52 cents higher. December hogs are up 0.37 after USDA reported a 3.0% in hog and pig inventory for September 1, in line with expectations. The June-August pig crop was also up 3%, as were both numbers for breeding and marketing hogs. A 2% increase in the farrowing intentions for September-November was officially more than expected, but probably surprised no one. After four years of expanding hog supplies, the overall outlook for hog prices remains bearish, but it's nice to see that retail demand still responds to low prices. Carcass prices are up nearly two dollars from last Friday and the Lean Hog Index for 9/26 was estimated at $65.34 up $7.90 from a week ago. Cash hog trade is expected to be steady early Friday. Thursday's total open interest fell 135 to 217,570. Open interest in the October contract dropped 2,052 to 23,660 and December contracts increased 681 to 101,806. Dow Jones projected hog slaughter for Friday at 472,000 head, up from 461,427 a year ago. 

#completeherdhealth

Thursday, September 27, 2018

Thursday Closing Livestock Market Summary - Hogs and Pigs Report near Expectations

GENERAL COMMENTS:
Livestock futures closed in the negative with lean hogs closing substantially lower. Hog futures fell $0.90 to $1.75 with December taking the brunt of the selling. Feeder cattle futures lost $0.45 to $0.60 while live cattle closed $0.20 to $0.32 lower. A few more bids showed up, but bids and offers remain apart. Bids remained at $109 to $110 with dressed at $174. Some light trade in parts of the North, mostly Nebraska at $174, generally $1.00 lower than last week on a weighted average basis. December corn futures closed 1.75 cents higher. The Dow Jones closed 55 point higher at 26,440, while the HASDAQ gained 52 points, closing at 8.042.
LIVE CATTLE:
Futures closed with narrow losses, with contracts $0.27 to $0.65 lower. Slaughter totaled 120,000 head, about even with last week, but 2,000 head below a year ago. Contracts followed a similar pattern as feeders trimmed their early losses. Beef cut-outs were lower (down $0.39 select and down $0.14 choice). There were 144 total load counts (52 loads of choice cuts. 47 loads of select cuts, 10 loads of trimmings and 35 loads of ground beef.
FRIDAY'S CASH CATTLE CALL:
Steady to $1.00 lower. Light cash trade Thursday, $1.00 lower, which may set the stage for lower offers as the week ends. Active trade should develop.
FEEDER CATTLE:
Feeder cattle trimmed earlier losses as the initial round of selling abated. Traders digested the upcoming trade talks with Japan and began focusing back on beef demand. Futures closed in the middle of the price range that has been developing over the past two weeks. Corn prices have been creeping higher, but a large crop to be harvested leaves little concern feed prices will rise too much. The seven-day average price for 700-800 pound feeder steers is $158.13, up $0.09 per cwt. Feeder cattle index for 9/26 is $158.13, up $0.09.
LEAN HOGS:
The quarterly Hogs and Pigs report showed all hogs and pigs at 103% of last year. Hogs kept for breeding at 103%. Kept for marketing at 103%. Each category was below the average trade estimate. This should be supportive to the market on Friday despite the numbers being higher than last year. Traders even up position prior to the report leaves room for renewed buying interest in futures. The lean hog index for 9/26 is $65.34, up $1.59.
FRIDAY'S CASH HOG CALL:
Cash is expected to remain steady as buyers will be cautious as trade opens. The hogs and pigs report was neutral, showing little need for buyers to get excited about offers being raised.

#completeherdhealth

Thursday Midday Livestock Market Summary - Livestock Futures Show Losses

GENERAL COMMENTS: 
Triple-digit losses have dominated feeder cattle futures early with selling nearly taking away the gains of yesterday. However, futures have regained some of those losses by midday. Live cattle future have followed suit, but not to the extent of feeders. October is barely hanging on to $113 after moving a bit lower earlier. There is some uneasiness after the interest rate hike from the Fed's yesterday as well as trade negotiations beginning with Japan. Selling activity is aggressive in lean hogs if front of the quarterly hogs and pigs report today. Corn is slight higher extending the gains of the past week. The Dow is up 155 points while the NASDAQ is 70 points higher.
LIVE CATTLE:
Trade discussions with Japan are on the minds of traders with the outcome key to continued strong exports to the country. This has delayed the threat of tariffs by the U.S. on Japanese auto exports to the U.S. However if talks do not turn out well, it could have substantial impact on beef exports to the country as anther trade war could develop. This is certainly too early to tell. There has been a bit more interest in purchasing cattle as more bids have been posted. However, no business has yet been done. Bids range from $109 to $1.1050 per cwt live basis while live dressed bids are $173 to $174 per cwt. Offers are $114 to 115 in the South and $180 and higher in the North. Boxed Beef cut-outs are mixed with (select) down $0.21 and (choice) up $0.02 per cwt. Movement is moderate at 85 loads (24 loads of choice cuts, 35 loads of select cuts, 5 loads of trimmings and 20 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures are under pressure with contracts rebounding from earlier triple-digit losses, but remain $0.55 to $0.75 lower. The nice price rebound yesterday is being trimmed likely in response to Japan trade talks and the Fed interest rate increase even though this may not have much impact. Traders are quick to take profits on outside news.
LEAN HOGS:
Trading activity is dominated by the upcoming Hogs and Pigs report to be released this afternoon. Front-month October is down $0.55 with December losses at $2.00. Traders are not too concerned about the impact on October, but are concerned about later supplies. The average analyst estimate for all hogs and pigs is 103.4 percent, kept from breeding at 103.1 percent, and kept for marketing at 103.5 percent. Cash prices are slightly higher on the National Direct morning cash report. The weighted average price is $0.17 higher at $63.31 with the range from $61.50-$64.00 on 4,335 sold. The National Pork Plant report posted 133 loads selling. Pork carcass valued slipped $0.19 per cwt settling at $80.68 per cwt. The projected 2-day lean hog index is $65.34, up $1.59.

#completeherdhealth

Thursday Morning Livestock Market Update - Hogs Await Thursday's USDA Report

GENERAL COMMENTS:
Wednesday's trade finished on a bullish note with December cattle posting a new seven-month high while cash bids inched higher, to $109. Later in the afternoon, AP reported that Japan and the U.S. were beginning negotiations on a new trade agreement -- news that may put a chill in traders' enthusiasm for both cattle and hogs. So far in 2018, Japan has taken one-third of U.S. beef exports and 17% of U.S. pork exports. Otherwise, traders will be watching to see if any cash trade develops Thursday, and it will be interesting to see if Wednesday's new high can survive until the end of the week.
Lean hog futures are holding steady in a narrow, sideways range, still near their highest prices in three months with USDA about to show another estimate of hog and pig inventories at 2 p.m. CDT. Early guesses are for a 3% increase in the September inventory of all hogs and pigs with a 2.5% increase in the June-to-August pig crop. With December hogs near their highest prices in three months, sellers seem likely to win the tug of war, but we also have to be impressed with how well carcass prices continue to work higher each week -- an impressive show of demand.

BULL SIDEBEAR SIDE
1)
December live cattle futures shook off Friday's bearish on-feed report and posted a new high Wednesday.
1)
Talk of new trade negotiations with Japan is apt to make traders nervous, knowing Japan is a big customer of U.S. beef and pork.
2)
Not much cash trade has developed yet this week, but bids were pushed up to $109 Wednesday.
2)
Select cuts of boxed beef continue to drift lower and are down nearly two dollars since Friday.
3)
Pork cutout values continue to firm through the month of September with carcass prices up over $2 since Friday.
3)
December hogs have rallied $14 from last month's lows, but it is fair to wonder if the rally is losing steam as supplies still seem ample.
4)
December lean hogs may have resistance at $58, but prices are holding firm so far.
4)
Thursday's Hogs and Pigs report from USDA is expected to show total inventory up a little more than 3% from a year ago, and it wouldn't take much of a deviation either way to hit prices fairly hard.


#completecalfcare

Wednesday, September 26, 2018

Wednesday Closing Livestock Market Summary - Cattle Markets Rally

GENERAL COMMENTS:
Packer interest improved Wednesday with bids becoming more evident in all areas. Live bids are from $109 to $110.50 per cwt, while dressed bids are developing at $173 to $174 per cwt. Asking prices are still well above these levels, at $113 to $114 live and $178 and higher dressed. It is likely most trade will be delayed until sometime Thursday or Friday. According to the closing report, the national hog base is $0.30 higher compared with the prior day settlement ($56.00-$64.00) weighted average $63.03. Corn futures are lower in light activity. December futures were 3/4 cent lower. Dow Jones Index is 26 points higher with Nasdaq up 33 points.
LIVE CATTLE:
Active buying interest moved into cattle futures with triple-digit gains in nearby trade ($0.65 to $1.65 higher). October and December futures led the complex higher with spot October moving to $113.87 per cwt following a $1.52 per cwt gain. December futures led the complex higher with gains of $1.65 per cwt, moving prices to $118.82 per cwt. Each of these contracts broke through short-term resistance levels set during the middle of September. Expectations are that follow-through support may develop during the end of the month. Beef cut-outs: lower, $1.92 lower (select, $192.95) and down $0.88 (choice, $204.85) with light demand and moderate to heavy offerings (92 loads of choice cuts, 37 loads of select cuts, 20 load of trimmings, 40 loads of coarse grinds).
THURSDAY'S CASH CATTLE CALL:
Steady to $1 higher. Bid and asking price negotiations are expected to continue early Thursday morning, picking up where packers and feedlot managers left off at midweek. Bids are likely to redevelop near $109 live and $173 to $174 dressed. Active trade is not expected until late Thursday or sometime Friday.
FEEDER CATTLE:
Strong triple-digit gains moved through most feeder cattle futures Wednesday ($0.42 to $1.82 higher). Aggressive underlying buyer support developed in all live cattle futures through the day Wednesday. News focusing on plans to open trade talks with Japan seems to have sparked some underlying buyer support. Japan continues to be a major importer of U.S. beef and beef products, creating some interest surrounding the potential to expand this relationship. Live cattle futures drove buyer support, although the most aggressive price support was in October and November feeder cattle futures with gains of $1.82 per cwt. This may spark some additional underlying support through the entire complex. CME cash feeder index for 9/24 is $157.83 up $0.53.
LEAN HOGS:
Firm pressure quickly developed through all lean hog futures with traders backing away from previous market support ($0.22 to $1.00 lower). Lean hog futures were pressured by deferred futures contracts with February through June contracts holding the most aggressive losses. The limited moves in front-month October futures have focused on the potential that currently known supply levels may be well in hand. The biggest question is: What will overall supply look like six months from now? A portion of the losses seen Wednesday is associated with traders trying to make pre-report adjustments in front of the Hogs and Pigs report, which will be released Thursday. It is not expected there will be significant substance in this report that will severely shift market direction, but the market still remains nervous, and is likely to focus on increased uncertainty through the rest of the week. Pork cuts continue to gain support on an overall carcass value, although primals were mixed in a wide triple-digit range Wednesday. Pork cutout values gained $0.42 per cwt, moving to $80.87 per cwt. CME cash lean index for 9/24 $62.05 up $1.20. DTN Projected lean index for 9/25 $62.05 up $1.70.
THURSDAY'S CASH HOG CALL:
Steady to $1.50 higher. Follow-through support is expected to redevelop through the cash complex with most bids expected $1 per cwt higher in firm trade volume. Thursday runs are projected to be 470,000 head with Saturday procurement rates seen near 217,000 head.

#completecalfcare

Wednesday Midday Livestock Market Summary - Cattle Markets Rally Midweek

GENERAL COMMENTS: 
Firm gains have quickly developed in most live cattle trade as traders focus on additional commercial buyer support moving back into the complex. This may add even more support to the entire complex. Lean hog futures are under firm pressure Wednesday morning. Corn markets are lower in light trade. December corn futures are 1/2 cent lower. Stock markets are higher in light trade. The Dow Jones is 67 points higher while Nasdaq is up 25 points.
LIVE CATTLE:
Aggressive buyer support is moving back into the live cattle complex. This has pushed December futures $1.05 per cwt higher with October contracts holding an 80 cent gain. The recent moves have pushed prices above $113 per cwt in front-month futures and $118 per cwt in December contracts. Although buyer volume remains limited through the morning with very little directional shifts likely to be seen through the end of the week. Cash cattle markets remain undeveloped, although bids are becoming more available. Live bids are seen at $109 to $110 per cwt while live bids are seen at $173 per cwt. Asking prices are developing at $113 to $114 live basis while dressed bids are seen at $178 per cwt. It is likely that active trade may be delayed until Thursday or Friday. Boxed Beef cut-outs at midday are lower, $1.69 lower (select) and down $0.37 per cwt (choice) with light movement of 76 total loads reported (27 loads of choice cuts, 19 loads of select cuts, 15 loads of trimmings, 15 loads of ground beef).
FEEDER CATTLE:
Firm gains have held in all but front-month September contacts. September futures are holding a narrow 7 cent per cwt loss. The rest of the complex is steady to 75 cents per cwt higher following the renewed support which is developing in the live cattle complex. There may be some additional underlying support seen through the end of the week with traders focusing on the potential to rekindle a bullish market trend through the end of the month and into early October.
LEAN HOGS:
Light to moderate pressure as seen in most lean hog futures Wednesday morning. Front month October futures are holding a 10 cent per cwt gain, in limited trade, while the rest of the complex remains under moderate to firm pressure with losses or 60 to 90 cents per cwt. There is expected to be some additional market uncertainty through the rest of the session, but current market pressure is likely to hold in most contract months. Cash prices are higher on the National Direct morning cash hog report. The weighted average price is $0.23 higher at $62.96 per cwt with the range from $60.00 to $63.50 on 8,270 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price is $0.18 lower at $63.11 per cwt with the range from $60.00 to $63.50 on 2,890 head reported sold. The National Pork Plant Report posted 179 loads selling on the morning report. Pork carcass values added $0.02 per cwt at $80.47 per cwt. Lean hog index for 9/24 is at $62.05 up 1.20 with a projected two-day index of 63.75, up 1.70.

#completecalfcare

Wednesday Morning Livestock Market Update - Limited Interest Expected Early Wednesday

GENERAL COMMENTS:
Activity in the cash cattle market is expected to remain quiet once again with bids likely at $174 dressed, and starting out near $106 on a live basis. At this point, it is uncertain just how much midweek interest there will be by either side, as active trade is not likely to develop until later in the week. Futures trade is expected mixed with limited interest likely to develop following the narrow market gains seen Tuesday. Nearby contracts are focusing on sustaining short-term support levels with October futures holding above $112 per cwt. Similar sluggish market direction is expected in feeder cattle markets as traders are focusing on outside grain market shifts through the end of September.
Firm market support is expected in cash market bids with early bids expected steady to $2 per cwt higher. Most bids are likely to be seen $1 to $1.50 per cwt higher as traders continue to take advantage of the firming pork complex as well as firm support in the lean hog complex. Limited trade is likely in hog futures early Wednesday morning with a combination of follow-through buying met by position-covering. Some moderate to firm market adjustments are likely the next couple of days as traders try to adjust positions due to end-of-the-month and quarter activity.

BULL SIDEBEAR SIDE
1)
Underlying support levels in nearby contracts have continued to hold after breaking away from the long-term sideways trend over the past couple of weeks. October's ability to sustain prices above $112 per cwt will likely continue to spark underlying market support.
1)
Limited activity midweek in cash cattle trade is pointing to what could be another sluggish and late-developing cash market move. This may limit overall widespread market strength.
2)
Strong underlying demand is expected through the end of the year with traders focusing on fair-to-good beef movement through domestic and export markets through the fourth quarter of the year.
2)
The strong price pressure early in the week has created some concerns that cattle trade could slip back into the previous sideways trend in the near future. The inability to sustain recent support may limit long-term buyer interest.
3)
Cash hog futures markets have continued market support with packers focusing on keeping procurement facilities full and have to continue to increase bids in order to do that.
3)
Strong market discounts to summer 2019 contracts have not changed significantly the last several weeks, leaving concern that traders still remain focused on aggressive short-term supplies through the end of the year.
4)
Nearby lean hog futures have continued to break through short-term highs, which is sparking additional underlying buying support through the entire complex.
4)
Wide price deviations in several pork cutout values is limiting the consistency of support through the pork product market. These prices are expected to continue to remain volatile through most of the fall and winter.


#completeherdhealth

Tuesday, September 25, 2018

Tuesday Closing Livestock Market Summary - Narrow Gains Support Cattle Futures

GENERAL COMMENTS:
Cash cattle trade is generally undeveloped with just a few token bids slipping into northern areas of $172 to $174 per hundredweight (cwt) in both Nebraska and Iowa. Asking prices are yet to be developed, as well as bids in southern cattle country. It is likely to be Wednesday or later when active bids and asking prices are seen and later in the week when actual trade develops. According to the closing report, the national hog base is $1.90 higher compared with the Prior Day settlement ($54-$64.50, weighted average $62.50). Corn futures were higher in light activity with the September futures contract closing 3 cents higher. The Dow Jones Index is 58 points lower with Nasdaq up 14 points.
LIVE CATTLE
Limited market movement with minimal direction characterized the cattle complex Tuesday. Futures closed $0.05 to $0.25 higher. Following the moderate price pullback early in the week after last week's Cattle on Feed report, traders seemed to take the generally bearish cold storage report in stride. Prices inched higher in light trade volume. More volatility is expected the next couple of trading sessions with end-of-the-month and end-of-quarter positioning developing. This may cause some additional movement, although traders seem to be focusing on a firming undertone to the market. Beef cut-outs: lower, $0.52 lower (select, $194.87) and down $0.43 (choice, $205.73) with light demand and moderate offerings (62 loads of choice cuts, 37 loads of select cuts, 33 load of trimmings, 12 loads of coarse grinds).
WEDNESDAY'S CASH CATTLE CALL:
Steady. Other than a few bids redeveloping midweek, early activity in the cash market is expected to remain undeveloped. Asking prices remain undeveloped, which is likely to push active trade to the end of the week.
FEEDER CATTLE:
Light buyer support slowly trickled into the market through the day with mixed early moves giving way to limited support. Futures closed $0.17 to $0.50 higher. Some additional buyer support may continue to move into the complex Wednesday as traders try to regain market confidence following recent pressure. Traders are now looking beyond cattle placement data and available beef in storage to potential demand through the fall. This could help to rekindle buyer support in most contract months. CME cash feeder index for 9/24 is $157.83, up $0.53.
LEAN HOGS:
Strong gains quickly developed across nearby lean hog futures, although limited trade left markets firm at best. Futures closed $0.25 to $1.42 higher. Traders pushed the front-month October lean hog futures contract triple digits higher to near $62.50 per cwt Tuesday. However, most of the volume developed in late-2018 and early 2019 contract months, which posted more subdued gains of 30 to 77 cents per cwt. The lack of consistent aggressive support may help to build additional gains over the next several days or weeks. Pork cuts shifted higher with primals moving in a mixed market range. Picnics posted triple-digit losses, while bellies increased by triple digits. Pork cutout values gained $0.43 per cwt, moving to $80.45 per cwt. CME cash lean index for 9/21: $60.85, up $1.76. DTN Projected lean index for 9/24: $62.05, up $1.20.
WEDNESDAY'S CASH HOG CALL:
Steady to $2 higher. Additional buyer support is moving into lean hog cash trade, allowing for firm underlying support to still be seen through the entire cash complex. Most bids are expected to be $1 per cwt higher. Wednesday runs are projected to be 468,000 head with Saturday procurement rates seen near 217,000 head.
#completecalfcare

Tuesday Midday Livestock Market Update - Sluggish Gains Seen Tuesday

GENERAL COMMENTS: 
Light buyer support is has slowly and steadily moved through the complex early Tuesday morning. This is helping to offset the early-week pressure as traders move further away from report-related supply issues and more focused on outside market direction and fundamental day to day market shifts. Limited price movement is expected in most contracts through the rest of the session. Corn markets are lower in light trade. September corn futures are 1 cent lower. Stock markets are higher in light trade. The Dow Jones is 28 points higher while Nasdaq is up 7 points.
LIVE CATTLE:
Limited interest is seen in live cattle futures early Tuesday. October live cattle futures continue to hold a narrow market gain with prices at $112.25 per cwt. The pull back to near $112.00 per cwt has caused some concern through the complex. If further pressure develops, and traders move prices sub-$112 per cwt through the week, increased questions of sustaining market support will quickly swarm through the market. All live cattle futures are holding limited gains of 2 to 22 cents per cwt in very limited trade. Cash cattle activity is quiet Tuesday morning with asking prices still not established in any area. A few token starter bids have been floated in Nebraska at $172 live basis. This may bring some additional activity through the next couple of days, but active trade is expected to be delayed until the latter half of the week. Boxed Beef cut-outs at midday are higher, $0.45 higher (select) and up $0.38 per cwt (choice) with light movement of 78 total loads reported (33 loads of choice cuts, 19 loads of select cuts, 22 loads of trimmings, 4 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures have slowly but steadily gained momentum with prices hovering 35 to 70 cents per cwt higher following lackluster interest early in the session. Traders are looking for additional buyer support through the entire complex, although the most aggressive support is seen in November and January futures with traders looking for longer-term support to develop through the market as traders seem to be focused on short term events over the recent days. The lack of market premium in the complex continues to be seen with all contracts through January 2019 trading within a $2 per cwt trading range. This indicates that limited market direction changes are expected through the end of the year.
LEAN HOGS:
Strong gains have continued to develop in nearby lean hog futures with October futures holding a $1.37 per cwt rally at midday. The rest of the complex remains extremely sluggish with prices hovering in a narrow range from 7 cents lower to 22 cents higher. The overall lack of direction in most contract months is causing some underlying concern about the ability to spark renewed support through the end of September. Cash prices are higher on the National Direct morning cash hog report. The weighted average price is $1.71 higher at $62.31 per cwt with the range from $54.00 to $64.00 on 7,366 head reported sold. Cash prices are higher on the Iowa/Minnesota Direct morning cash hog report. The weighted average price is $1.78 higher at $63.36 per cwt with the range from $54.00 to $64.00 on 4,639 head reported sold. The National Pork Plant Report posted 160 loads selling on the morning report. Pork carcass values added $0.05 per cwt at $80.07 per cwt. Lean hog index for 9/21 is at $60.85 up 1.76 with a projected two-day index of 62.05, up 1.20.

#completeherdhealth

Tuesday Morning Livestock Market Summary - Weaker Market Tone Expected Tuesday

GENERAL COMMENTS:
Cash cattle activity is expected to remain silent through most of the session with bids and asking prices currently undeveloped and likely to remain that way until midweek or later. The pressure in futures trade on Monday is expected to spark some additional market liquidation with early movement expected to remain steady to lower in several contract months. Some attempts of short-covering interest moving into the market early is likely due to limited volume as markets open, but the overall tone remains weak. The increased beef in storage in the Cold Storage report will cause additional concerns for many traders.
Follow-through support in cash hog values is expected to redevelop through the morning with bids steady to $2 per cwt higher. Most bids will remain firm to $1 per cwt higher as packers look for additional hogs and are able and willing to increase bids in order to keep plants full. Tuesday's slaughter expectations are at 466,000 head with additional focus on picking up a portion of the losses from last week associated with flooding and the hurricane. Futures trade is expected to be mixed to mostly lower, most contracts are expected to trade weak to $1 per cwt lower during the morning, but limited volume in the opening minutes of trade could keep prices uncertain.

BULL SIDEBEAR SIDE
1)
Firm gains in boxed beef values have continued to redevelop following underlying support in futures and cash trade late last week. This continues to look toward the future and potential active movements of beef through the end of the year.
1)
Strong triple-digit pressure on Monday continues to add uncertainty about follow-through support given the increased availability of cattle in the Cattle on Feed report. This will continue to be a cloud hovering over the market for the near future.
2)
Despite the market pullback, live cattle futures continue to trade in the upper level of short-term trading ranges, following the break out of the sideways pattern in the last couple of weeks. Despite short-term adjustments, this still is causing traders to take a bullish long-term view of the market.
2)
Beef in storage has continued to surge higher, with record levels of beef available in coolers at 503.4 million pounds. This is 6% above year-ago levels and likely to add even more pressure on cattle prices.
3)
Cash hog values continue to ratchet higher with increased buying support moving back to the complex. This may continue to build underlying support.
3)
Total pork available in storage increased, although only 1% over year-ago levels, the short-term movement looks less encouraging with a 6% bounce from month-ago levels.
4)
Pork cutout values remain firm to strong with prices adjusting higher following an 86 cent per cwt rally in carcass values through the day Monday. This is expected to help stabilize the market following the bearish Cold Storage report.
4)
Pork bellies in storage have increased significantly. Even though bellies are down from month-ago levels, pork bellies in inventory grew 82% from year-ago levels. This is likely to add volatility to all primal cuts through the near future.

#completeherdhealth

Monday, September 24, 2018

Monday Closing Livestock Market Summary - Cattle Markets Weaken on Strong Supply

GENERAL COMMENTS:
Cash cattle trade was undeveloped Monday, with activity limited to inventory taking and showlist distribution that usually takes place early in the week. Active bids and asking prices are not expected until midweek or later. According to the closing report, the national hog base is $1.03 higher compared with the prior day settlement ($53.00-$63.50) weighted average $60.53. Corn futures are higher in light volume. September futures were 3 cents higher Monday. Dow Jones Index is 149 points lower with Nasdaq up 4 points.
LIVE CATTLE
Moderate losses posted through live cattle futures, although traders were unwilling to hold early session lows as market stability seems to be the focus in the near future ($0.42 to $1.45 lower). December live cattle futures led the complex lower Monday with a $1.45 per cwt loss. Lack of support in the entire cattle complex comes as traders look for increased overall movement following the digestion of increased cattle available in feedlots. It is not expected that this bounce higher in numbers will totally derail the support seen over the last few weeks, but this could cool overall buyer support when it comes to long-term market moves. Beef cut-outs: higher, $0.68 higher (select, $195.39) and up $1.36 (choice, $206.16) with light demand and offerings (46 loads of choice cuts, 16 loads of select cuts, 9 load of trimmings, 17 loads of coarse grinds).
TUESDAY'S CASH CATTLE CALL:
Steady. Cash cattle markets expected to remain undeveloped until well into the week. There is growing uncertainty about just how much additional support will be seen following firm futures pressure.
FEEDER CATTLE:
Firm pressure swept through the complex, focusing on increased placement levels in August ($0.50 to $1.87 lower). Despite the sluggish movements in front-month September, which posted a loss of 50 cents per cwt, the remainder of nearby contracts posted triple-digit losses. There is growing uncertainty as to just how much follow-through pressure will develop, as market losses continue to develop. Moderate to firm pressure in live cattle futures continues to be closely watched by feeder cattle traders as they start looking past supply levels and to long-term demand potential in the complex. CME cash feeder index for 9/21 is $157.30 up $1.01.
LEAN HOGS:
Limited trade through most of the complex with traders pushing prices mostly higher ($0.42 lower to $0.70 higher). October lean hog futures led the complex higher, moving to $61 per cwt at closing bell. The limited price ranges through most of the day left most traders hovering on the sidelines. Although there continues to be a sense of firmness to the lean hog complex, the ability for traders to push prices through short-term resistance levels remains unknown. This may limit additional activity early in the week. Pork cuts have gained additional momentum Monday with increased overall support developing through the complex. Pork cutout values gained $0.86 per cwt, moving to $78.70 per cwt. CME cash lean index for 9/20 $59.09 up $1.65. DTN Projected lean index for 9/21 $60.85 up $1.76.
TUESDAY'S CASH HOG CALL:
Steady to $2 higher. Firm follow-through cash market support is expected to continue to develop

#completecalfcare

Monday Midday Livestock Market Summary - Cattle Futures Weaken

GENERAL COMMENTS: 
Cattle futures are under firm pressure as follow-through losses are seen during the entire morning. This increased cattle placements and larger on feed number than what was expected is causing widespread weakness. Corn markets are higher in light trade. September corn futures are 2 cents higher. Stock markets are lower in light trade. The Dow Jones is 176 points lower while Nasdaq is down 12 points.
LIVE CATTLE:
Strong pressure has been seen Monday morning through the live cattle complex. Very little long-term direction is seen through the morning, although traders seem to be still adjusting to Friday's cattle on feed report. It is uncertain just how much of this market reaction will be confirmed as additional trade volume moves into the market over the next couple of days. It is expected that additional market volatility may develop over the coming days. Cash cattle markets are silent Monday morning with show list distribution and inventory taking the main order of business. This may continue through the middle of the week, allowing for increased movement Thursday and Friday. Boxed Beef cut-outs at midday are lower, $0.76 lower (select) and down $1.45 per cwt (choice) with light movement of 42 total loads reported (25 loads of choice cuts, 9 loads of select cuts, 0 loads of trimmings, 7 loads of ground beef).
FEEDER CATTLE:
Strong triple-digit pressure is moving into the feeder cattle futures market early Monday. The firm gains from year-ago levels seen on the cattle on feed report when it comes to feedlot placements have pulled any sense of market support away from the complex. The placements on the September 1st report, is the largest number of placements seen since these current numbers have been recorded. The focus on lower grain prices is creating a push to put more cattle in feed yards earlier than what is typically seen. This may influence not only current levels, but shift percentages through the end of the year.
LEAN HOGS:
Lean hog futures are mixed in a narrow range with very limited activity seen through the entire complex. The limited movement in cash and futures trade is likely to leave prices hovering within a very narrow range through the rest of the session. Narrow losses in nearby contracts have been influenced by the pressure in the cattle complex. The focus on firming support in deferred trade is helping to spark some additional, but light buyer interest. Cash prices are unreported due to confidentiality on the National Direct morning cash hog report. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. The National Pork Plant Report posted 122 loads selling on the morning report. Pork carcass values added $0.78 per cwt at $79.96 per cwt. Lean hog index for 9/20 is at $59.09 up 1.65 with a projected two-day index of 60.85, up 1.76.

#completeherdhealth

Monday Morning Livestock Market Update - Cattle Pressure Likely Monday

#completecalfcare

GENERAL COMMENTS:
Sluggish market direction is expected through the early hours of trade Monday as traders return to the market following the weekend break. The lack of underlying support in last week's Cattle on Feed report is likely to limit buyer support and put additional pressure on cattle trade. The generally steady cash cattle trade last week that developed late in the week seemed to focus on additional market uncertainty through the complex, wondering if prices will be able to break out of the recent back and forth shifts last week following the move higher in early September. Cash cattle markets will focus on showlist distribution and inventory taking with active bids and offers not expected until midweek or later.
Cash hog bids are expected to develop steady to $1 per cwt higher with most bids expected steady to firm through the morning Monday. This overall support continues to bring additional stability even though moderate, late-week pressure developed through nearby lean hog trade late last week. Mixed futures trade is expected as traders try to establish a more defined direction over the coming days as traders look for a combination of outside market support as well as underlying uncertainty when it comes to global trade issues.

BULL SIDEBEAR SIDE
1)
February live cattle futures moved above $122 per cwt once again in late-week trade, as futures settled at $122.25 per cwt, even though the focus on growing supplies continues, additional long-term demand focus remains in the entire cattle complex.
1)
Feeder cattle placements through the month of August increased significantly with 107% of feeder cattle in feedyards compared to one year ago. This is well above expectations and at the top end of estimate ranges before the report.
2)
Moderate price pressure in grain trade continues to bring additional buyer activity to the livestock market, especially the cattle trade. This focuses on lower overall production costs not only for cattle currently in feed yards, but the focus on potential reduced feed costs through the rest of the year.
2)
Total cattle on feed increased to above expected levels and slightly above the top range of estimates. With 106% of cattle on feed as of September 1st, this will likely add some early week pressure to the entire complex. This is firmly above the expected level of 105.3%.
3)
Continued strong support in the Dow Jones Index last week has set new market highs in the stock market. This is helping to spark some underlying support through the entire economy at this point despite limited short-term support in many commodity markets.
3)
Pork values was only able to show minimal support through the end of last week, creating some concerns that the recent underlying support in cash trade and futures support could be limited by the ability to keep actively moving pork product during late September.
4)
Cash hog values continued to march higher through the last couple of weeks as overall firm buying continues to keep the pipeline full. The $1 per cwt gain Friday afternoon is expected to add additional cash buyer support through the complex Monday.
4)
Firm futures pressure Friday in all nearby lean hog contracts is bringing questions about the ability to spark additional underlying support through the entire lean hog market over the coming days. This may spark increased volatility in nearby futures trade early Monday.