GENERAL COMMENTS:
Feeder
cattle and lean hog contracts are scaling higher at midday Thursday,
while the live cattle complex trades lower and the cash cattle market
continues to be extremely slow and quiet. December corn is down 1/2 cent
per bushel and December soybean meal is up $1.90. The Dow Jones
Industrial Average is down 84.18 points and NASDAQ is down 100.49
points.
LIVE CATTLE:
Live
cattle contracts are sitting back idly as the industry doesn't have
support from traders to rally nearby contracts higher and the lack of
momentum from the cash market has been disappointing as well. August
live cattle are down $0.70 at $100.80, October live cattle are down
$1.17 at $104.50 and December live cattle are down $1.07 at $109.05.
Asking prices for cattle this week are $98 or better in the South, and
$159 to $160 in the North. For the most part, packers have just been
quiet, calling on a few pens of cattle here and there but not showing
great interest this week. Packers have shown a of acquisition since the
first week in June, averaging 113,312 head of cattle purchased each
week, giving them a hefty inventory to work through.
Thursday's
export report shared that beef net sales of 15,600 metric tons (mt0
reported for 2020 were down 44% from the previous week and 15% from the
prior 4-week average. The three primary increases were from South Korea
(4,500 mt, including decreases of 400 mt), Japan (4,200 mt, including
decreases of 1,000 mt) and Taiwan (2,400 mt, including decreases of 100
mt).
Boxed beef prices are higher: choice up
$1.59 ($202.74) and select up $1.89 ($191.17) with a movement of 52
loads (30.02 loads of choice, 8.84 loads of select, 3.91 loads of trim
and 9.70 loads of ground beef).
FEEDER CATTLE:
After
some slight regression and hesitation earlier this week, the feeder
cattle complex has jumped back to its recent surge of fully higher
prices. August feeder cattle are up $0.90 at $142.42, September feeder
cattle are up $0.32 at $143.60 and October feeder cattle are up $0.27 at
$143.85. The industry has been steadily backed by the rigorous buying
throughout the countryside and continues to see sales report constantly
steady to higher prices. Not to mention farmer feeders look at cheap
corn prices and see feeders as a way to use up some of that supply.
LEAN HOGS:
The
lean hog complex is feeling ambitious as nearby contracts soar upwards
of $1.00 to $2.00 higher. August lean hogs are up $2.15 at $54.80,
October lean hogs are up $1.42 at $51.50 and December lean hogs are up
$0.80 at $52.25. The market recently tested the resistance level at $54,
but as the market looks to climb higher, pressure will be felt later
down the road at $58.
Thursday's export
report shared that pork net sales of 31,800 mt reported for 2020 were
down 17% from the previous week and 4% from the prior 4-week average.
The three primary increases were from Mexico (12,900 mt, including
decreases of 100 mt), China (7,200 mt, including decreases of 600 mt)
and Japan (4,300 mt, including decreases of 200 mt).
The
projected lean hog index for 7/22/2020 is up $0.26 at $49.69 and the
actual index for 7/21/2020 is up $0.78 at $49.43. Hog Prices are higher
on the National Direct Morning Hog Report, up $0.28 with a weighted
average of $35.67, ranging from $30.00 to $40.25 on 8,517 head and a
five-day rolling average of $32.96. Pork cutouts total 164.29 loads with
141.15 loads of pork cuts and 23.14 loads of trim. Pork cutout values:
up $4.37, $73.70.
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