General Comments
Heading
into Thursday's afternoon hours, live cattle contracts push fully steam
ahead, the lean hog complex has seen a spark in support meanwhile the
feeder cattle contracts are fighting nearby resistance that is turning
most of the contracts lower. Packers continue to hold their cards tight
to their chest as some more cattle have traded throughout the Southern
plains, but the Northern plains remain extremely quiet. December corn is
up 11 1/2 cents per bushel and December soybean meal is up $9.80. The
Dow Jones Industrial Average is down 51.91 points and NASDAQ is up 98.00
points.
LIVE CATTLE
Live
cattle contracts keep scaling higher while the cash cattle market is
shaping up to be tough in the Northern Plains as packers seem relentless
to pay this week's asking prices and feeders are unwilling to budge as
their supplies are mostly current. August live cattle are up $0.80 at
$107.15, October live cattle are up $0.67 at $110.25 and December live
cattle are up $0.32 at $112.87. Packers have picked up some more
Southern cattle at $104 and have placed bids from $165 to $170 dressed
in Iowa and $106 to $107 live in Iowa as well. Thus far feeders have let
those bids sit idly on the table. Heading into the afternoon it will be
important to see where boxed beef movement ends up as Wednesday was an
impressive day moving 182 loads as Americans begin to prepare for Labor
Day weekend.
Thursday's export report shared
that beef sales of 11,600 mt were reported for 2020 which was down 13%
from the previous week and 46% from the prior 4-week average. The three
primarily increases were from Japan (2,900 mt, including decreases of
500 mt), China (1,900 mt) and Canada (1,400 mt, including decreases of
100 mt).
Boxed beef prices are higher: choice
up $1.83 ($210.92) and select up $1.51 ($197.50) with a movement of 98
loads (53.39 loads of choice, 18.75 loads of select, 13.47 loads of trim
and 12.42 lads of ground beef).
FEEDER CATTLE
After
three days of strong gains in the feeder cattle complex, Thursday's
feeder cattle market is fighting modest resistance in nearby contracts.
August feeders are steady at $145.25, September feeders are down $0.50
at $147.45 and October feeders are down $0.60 at $148.50. The
countryside sits without any major feeder cattle sales this week; just
the scheduled sales throughout the sale barns which have continued to be
aggressive, but next week Superior will host their Big Horn Classic
sale in Sheridan, Wyoming and Western Video Market will host their video
sale in Cheyenne, Wyoming and the following week Northern Livestock
Video auction is set to host their Early Fall Preview. As the market
bounces back and forth between thinking the markets done what it can in
the short term to believing that with the immensely support for buyers
that there's more to be had -- these upcoming sales will dial-in the
market's perspective as fall nears.
LEAN HOGS
The
lean hog complex has seen nearby contracts jump upwards of $0.80 while
deferred contracts follow in a modest fashion. August lean hogs are up
$0.87 at $53.77, October lean hogs are up $0.82 at $52.42 and December
lean hogs are up $0.77 at $54.17. The market's been able to slowly push
cutout values modestly higher and hopefully Thursday's close can
continue with the market's strength. As the feeder cattle contracts grow
and traders worry about how much more upside potential is in the
market, the lean hog complex becomes more appealing.
The
projected lean hog index for 8/11/2020 is up $0.03 at $53.82, and the
actual index for 8/10/2020 is up $0.77 at $53.79. Hog prices are
unavailable on the National Direct Morning Hog Report due to
confidentiality. Pork cutouts total 184.29 loads with 148.92 loads of
pork cuts and 35.38 loads of trim. Pork cutout values: up $4.01, $76.45.
Pork
net sales of 10,500 mt were reported for 2020 which was down 66% from
the previous week and 70% from the prior 4-week average. The three
primarily increases were from Mexico (8,800 mt, including decreases of
200 mt), Japan (2,700 mt, including decreases of 900 mt) and Canada
(1,600 mt, including decreases of 400 mt).
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