GENERAL COMMENTS:
As
Thursday afternoon progressed, the cattle complex endured more pressure
and eventfully the feeder cattle contracts caved to closing lower
alongside the live cattle contracts. Feeders are still selling
exceptionally well, but the board just didn't have enough support to
keep prices elevated. Hog prices are higher on the National Direct
Afternoon Hog Report, up $0.62 with a weighted average of $36.01 on
10,207 head. December corn is up 3/4 cent per bushel and December
soybean meal is up $3.70. The Dow Jones Industrial Average is down
353.51 points and NASDAQ is down 244.71 points.
LIVE CATTLE:
Live
cattle contracts took the brunt of Thursday's bearish blow. The
market's lack of cash cattle interest has left contracts sitting idly
and traders are too worried about supporting the complex after last
week's rally. August live cattle closed $0.65 lower at $100.85, October
live cattle closed $1.12 lower at $104.60 and December live cattle
closed $1.10 lower at $109.02. Packer inquiry is still less than
expected throughout the countryside. Bids of $158 to $98 are common
throughout the North where asking prices are $160 dressed and $99 to
$100 live. The Southern Plains did more some cattle at $96 and some
cattle did trade in Nebraska for $158 and $98.
Thursday's
slaughter is estimated at 120,000 head, 3,000 head more than a week ago
and 2,000 head less than a year ago. Friday will be a busy day for the
market as the USDA is to release the latest Cattle on Feed and Cattle
Inventory reports as well.
Thursday's Actual
Slaughter report shared that, for the week ending 7/11/2020, slaughter
was slightly less than expected and that carcass weights had increased
from the previous week. Slaughter was estimated to total 664,000 head,
when it actually totaled 648,897 head. Actual live weights increased by 7
pounds up to 1372 pounds and dressed weights jumped 7 pounds as well to
838 pounds.
Boxed beef prices closed higher:
choice up $1.11 ($202.26) and select up $1.51 ($190.79) with a movement
of 123 loads (74.06 loads of choice, 18.79 loads of select, 9.33 loads
of trim and 20.86 loads of ground beef).
FRIDAY'S
CASH CATTLE CALL: Steady. This week has been strange for cash cattle
trade. Packers have been nonchalant and feeders are holding out, hoping
to get their full asking prices.
FEEDER CATTLE:
Feeder
cattle contracts submitted to the pressure that the live cattle complex
spread through the afternoon. August feeders closed $0.50 stronger at
$142.02, September feeders closed $0.10 lower at $143.17 and October
feeders closed $0.10 lower at $143.42. The cash cattle market's lack of
interest has traders leery about the week after last week pushed the
market significantly higher. At Mitchell, South Dakota, compared to last
week, feeder steers weighing 800 to 950 pounds sold $1.00 to $2.00
stronger, while feeder steers weighing 950 pounds sold steady to $2.00
lower. Feeder heifers up to 750 pounds sold steady, but with a strong
undertone, while heifers weighing 750 pounds and up sold steady to $2.00
stronger. Demand was good again and many of the cattle sold in load
lots. The CME feeder cattle index 7/22/2020: up $1.54, $137.96.
LEAN HOGS:
The
cattle complex endured pressure, but the lean hog complex took the
day's opportunity to push higher. August lean hogs closed $1.82 higher
at $54.47, October lean hogs closed $0.95 higher at $51.02 and December
lean hogs closed $0.75 stronger at $52.20. Aided by a strong cash market
($0.62 higher on 10,207 head), traders saw the day as an opportunity
worth taking, and so contracts moved higher. Pork cutouts totaled 344.96
loads with 304.04 loads of pork cuts and 40.92 loads of trim. Pork
cutout values: up $0.34, $69.67. Thursday's slaughter is estimated at
476,000 head - 8,000 head less than a week ago and 6,000 head more than a
year ago. The CME lean hog index 7/21/2020: up $0.78 at $49.42.
Thursday's
Actual Slaughter report shared the same news for the hog industry as it
did the cattle complex -- slaughter wasn't as strong as assumed and
weights inched higher. For the week ending 7/11/2020, the week's
estimated slaughter was anticipated at 2,606,000 head while it totaled
really 2,597,455 head. Actual live weights held steady at 284 pounds,
but actual dressed weights gained a pound to 213 pounds on average.
FRIDAY'S
CASH HOG CALL: Steady. Thursday posted a great cash hog trade, as
prices jumped higher and on a large volume. It would be a big push to
get prices higher again -- steady trade is more realistic.
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