Friday Closing Livestock Market Update - Feedlots Digging In

Heading into the weekend, the unanswered questions of this week are, "how are fat cattle going to round out the week's trade?" With only a small sampling of cattle traded as of this point, there's still time yet this week for business to be conducted. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.31 with a weighted average of $61.31 on 6,857 head. December corn is steady and December soybean meal is steady. The Dow Jones Industrial Average is down 157.51 points and NASDAQ is down 274.00 points.

From Friday to Friday, livestock futures scored the following changes: October live cattle up $2.63, December live cattle up $4.72; November feeder cattle up $7.75, January feeder cattle up $8.58; December lean hogs down $1.45, February lean hogs down $1.38.

LIVE CATTLE:

This week's cash cattle trade is going into overtime! Feeders had a sour taste of last week's cash cattle trade as the market veered lower and knew that, if they were going to get steady to higher prices, they were going to have to step up their game. As of closing Friday, less than 50,000 head have sold this week and Friday's movement was relatively light, indicating that one of two options could happen: Option one is that packers up their bids and buy cattle late Friday afternoon or early Saturday; option two is that this week's volume goes light and next week the pressure resumes. If feeders aren't able to sell the number of cattle they'd like to this week, they could be anxious to sell early next week, but it's important to remember that when feeders rally together, they can leverage their position against packers and more easily move the market.

This week's live cattle market was favorable to feedlots as the market scaled higher and boxed beef prices even printed stronger later in the week. December live cattle closed $0.32 higher at $108.30, February live cattle closed $0.02 higher at $110.40 and April live cattle closed $0.12 higher at $113.65. For the week's cash cattle trade that has occurred, Southern cattle sold for $106, which is steady with last week's business, and Northern cattle sold $103 to $104, which is $1.00 softer than last week's trade. Friday's slaughter is estimated at 114,000 head, 11,000 head more than a week ago and 4,000 head less than a year ago. Saturday's kill is projected to be around 64,000 head and Thursday's slaughter was revised to 110,000 head.

For the week choice cuts averaged $207.15 (down $1.88 from last week) and select cuts averaged $189.84 (down $1.54) and the week's total boxed beef movement accumulated to 745 loads of cuts, grinds and trim.

Boxed beef prices closed higher: choice up $0.78 ($208.10) and select up $0.01 ($191.24) with a movement of 106 loads (55.02 loads of choice, 25.50 loads of select, 7.78 loads of trim and 17.66 loads of ground beef).

MONDAY'S CASH CATTLE CALL: Steady to somewhat higher. It's hard to call next week's trade before this week's business really wraps up. Next week's business will largely be contingent on how this week's wrap concludes.

FEEDER CATTLE:

The feeder cattle market was the fuel the fire needed in order to roll the cattle markets higher this week. Week-over-week gains were utterly phenomenal for the feeder cattle market as November feeders gained $7.75 from last Friday and January feeders rallied $8.58 from last Friday. Traders were looking for a market to invest within and, thankfully for cattlemen, the corn market scaled lower, giving the feeder cattle market free rein to scale higher. November feeders closed $1.67 higher at $137.40, January feeders closed $2.77 higher at $134.12 and March feeders closed $2.55 higher at $133.52. South Dakota's Weekly Summery shared that, compared to last week, steer and heifer calves sold $1.00 to $3.00 higher, and yearling feeder steers and heifers traded $1.00 to $3.00 lower. Overall demand was good this past week and notably higher than a week ago, which was antagonized by the board's higher trend. Winter weather did make marketing calves difficult in some regions throughout the country and led to lighter receipts this past week. Heading into next week's trade a larger run of calves is expected to hit the market again as prices trended modestly higher and roads become more favorable for traveling. The CME feeder cattle index for Oct. 29: up $2.42, $136.76.

LEAN HOGS:

Heading into the weekend, deferred lean hog contracts got to close on a positive note. While the cattle complex stole the week's attention and interested traders more so than the lean hog market; as resistance levels remain lofty, the hog market simply scaled lower this past week. December lean hogs closed $0.05 lower at $65.57, February lean hogs closed $0.05 lower at $65.55 and April lean hogs closed $0.07 higher at $68.40. Pork cutouts totaled 312.76 loads with 278.52 loads of pork cuts and 34.23 loads of trim. Pork cutout values: down $3.77, $83.80. Friday's slaughter is estimated at 485,000 head, 1,000 head less than a week ago and 4,000 head less than a year ago. Saturday's kill is projected to be around 251,000 head, and Thursday's slaughter was revised to 483,000 head. The CME lean hog index for Oct. 28: down $0.78, $75.49.

MONDAY'S CASH HOG CALL: Lower. The cash hog market has been dancing on both sides of steady, but as the futures markets deems lower, the market could trade softer next week unless cutout values find robust support.

#completecalfcare

Friday Midday Livestock Market Summary - Contracts Rally Support into Afternoon

General Comments

The live cattle contracts are facing a little pressure at midday, but both the feeder cattle and lean hog markets are trading steadily higher. Cash cattle bids are starting to pop but and draw more packer interest, but feedlots have yet to jump on those offers. December corn is down 1 1/4 cents per bushel and December soybean meal is down $2.00. The Dow Jones Industrial Average is down 242.56 points and NASDAQ is down 239.75 points.

LIVE CATTLE

Live cattle contracts have seen some pressure jump in and out of the nearby contracts; but as the day hits noon, the complex is trading mostly higher. December live cattle are up $0.15 at $108.12, February live cattle are up $0.10 at $110.47 and April live cattle are up $0.27 at $113.80. As the week's cash cattle market is seeing bids surface -s the morning's higher boxed beef prices and higher trending futures market brings a sign of relief to feedlots. Bids of $106 are still being offered in Kansas and bids of $104 live and $162 dressed are offered in Nebraska. Thus far feedlots have opted to let the bids sit, hoping packers get more aggressive as the day rolls into the afternoon.

Boxed beef prices are higher: choice up $1.00 ($208.32) and select up $3.10 ($194.33) with a movement of 69 loads (34.55 loads of choice, 14.00 loads of select, 6.76 loads of trim and 13.83 loads of ground beef).

FEEDER CATTLE

Corn prices are rallying modestly scaling $0.01 higher in nearby contracts and upward of $0.03 higher in deferred contracts, but the feeder cattle market isn't seeming too worried. November feeders are up $0.77 at $136.50, January feeders are up $1.32 at $132.72 and March feeders are up $1.10 at $132.07. For cow-calf producers that have yet to market their calves, the position added this week has been a relief. As the market tracks through the rest of the year, producers will have to gauge how supply and demand are weighing on the market and market their calves when buyers are hungry.

LEAN HOGS

Hog prices are seeing a slight uptick in prices trailing into the day's afternoon trade. With slight support for a modestly higher cash hog market and an uptick in the day's midday cutout value, the market walk hand-in-hand as the markets technical sides sees support from the fundamentals. December lean hogs are up $0.62 at $66.27, February lean hogs are up $0.77 at $66.37 and April lean hogs are up $0.37 at $68.70. The markets support is good for the market's moral, but with the market still up against long-term resistance, a lower trend is still anticipated.

The projected lean hog for 10/29/2020 is down $1.00 at $74.49, and the actual index for 10/28/2020 is down $0.80 at $75.49. Hog prices are higher on the National Direct Morning Hog Report, up $0.10 with a weighted average of $61.76, ranging from $56.00 to $63.00 on 5,882 head and a five-day rolling average of $61.62. Pork cutouts total 189.10 loads with 167.38 loads of pork cuts and 21.72 loads of trim. Pork cutout values: up $0.95, $88.52. 

#completeherdhealth

Friday Morning Livestock Market Summary - Markets May Show Weekend Positioning

 General Comments:

Cattle futures kept rolling higher Thursday, putting in a very strong day as December posted the highest close since Oct. 16. It appears the Cattle on Feed report established the bottom. When you throw bearish news at a market and it rallies, it indicates a market that is supported and should not have fallen as far as it had. What is missing, and should develop Friday, is business taking place for the week. Packers seem to have been holding out, waiting for weakness in futures in order to place lower bids. But that has not happened, and time is running out. There was some slight trade in the South at steady prices with last week, but this is not a good representation of market sentiment. Packers will need to step up Friday or explain to their bosses what they have been doing during the week other than accomplishing business.

Hog futures are not receiving any residual spillover from the cattle complex. December and February contracts seemed determined to close chart gaps from Sept. 10. December was able to accomplish the task, but February fell 5 points short of the goal. Large pork supply has been talked about for quite some time, but demand has been good both domestically and internationally with China being a large importer. However, cutouts have been struggling as traders fear a slowing of demand as a result of the increasing coronavirus spread. This fear may be unfounded as consumers will shop for value at good prices. Lower cutouts should spur demand.

	BULL SIDE		BEAR SIDE
1)	Strong futures gains should result in some follow-through buying Friday. Traders have gained confidence in the ability of the market to hold. Funds are adding to long positions.	1)	Cattle futures may have rallied too far, too fast and might be in for a strong correction prior to the weekend.
2)	Packers will need to accomplish business today and likely will need to do it at steady or higher prices. This could provide further support and regain some of the losses.	2)	Packers may be only willing to bid steady with last week ,which would already be factored into the market. Traders may see little reason to push futures higher.
3)	Hog futures are oversold and could generate short-covering into the weekend.	3)	Hogs have not been able to follow the strength of cattle. Prices need to decline in order to keep product moving through retail or through exports.
4)	Exports sales Thursday indicated good movement for pork markets which may keep supply from building. This may provide price support to the market.	4)	The February contract still has a price gap to fill $1.10 below the close of Thursday. This could be accomplished Friday as the market struggles to find solid footing.

#completeherdhealth

Thursday Closing Livestock Market Summary - Cattle Build Stronger

Thursday was another strong day for the cattle contracts as support continues to grow and is allowing for the markets to have a commendable rally. As the market prepares for Friday, watching how the week's cash cattle trade will pan out is going to be interesting. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.31 with a weighted average of $61.70 on 8,017 head. December corn is down 3 cents per bushel and December soybean meal is up $0.20. The Dow Jones Industrial Average is up 139.16 points and NASDAQ is up 180.72 points.

LIVE CATTLE:

Live cattle contracts clung to the support that rallied earlier in the week in the feeder cattle market and moved nearby contracts $2.00 to $3.00 higher Thursday. December live cattle closed $3.30 higher at $107.97, February live cattle closed $2.67 higher at $110.37 and April live cattle closed $2.15 higher at $113.52. The higher trade has feedlots hopeful to market cattle for at least steady prices this week, if not slightly stronger. There was some light trade that took place Thursday afternoon in the South at $106, which is fully steady, and Northern cattle traded for $103 to $104, which was actually $1.00 lower than last week's weighted average. Southern cattle will keep a premium on Northern cattle for the short term as Northern supplies are greater than that in the South, and Northern packers have ample supplies already bought. Thursday's lighter slaughter is due to the fact that two plants in Texas had difficulties getting cattle into the plants as ice and snow made transportation difficult. Thursday's slaughter is estimated 114,000 head, down 6,000 head from last week and 4,000 head from a year ago.

Thursday's actual slaughter data isn't sharing the same kind of joyous news that the rest of the market is rallying upon. For the week ending Oct. 17, slaughter was robust, totaling 658,614 head, but the disappointing component is the increasingly larger weights. Steers gained another from the previous week; averaging 929 pounds, which is only 1 pound lighter than the industry's high in 2015 when steers weighed 930 pounds, and heifer weights continue to grow. For the week ending Oct. 17, heifers averaged 850 pounds, 4 pounds heavier from the previous week and 4 pounds over the all-time high in 2015.

Beef net sales of 18,900 mt reported for 2020 were down 13% from the previous week and 6% from the prior four-week average. The three primarily increases were for China (4,300 mt), Japan (4,200 mt, including decreases of 200 mt) and South Korea (4,200 mt, including decreases of 1,500 mt).

Boxed beef prices closed higher: choice up $1.53 ($207.32) and select up $1.65 ($191.23) with a movement of 156 loads (93.32 loads of choice, 18.39 loads of select, 24.77 loads of trim and 19.71 loads of ground beef). FRIDAY'S CASH CATTLE CALL: Steady. Depending on how the market cooperates Friday, feeders should be able to keep the market fully steady if not rally a little stronger in the South especially.

FEEDER CATTLE:

Feeder cattle contracts veered higher and pushed the market anywhere from $1.10 to $1.82 stronger at closing. November feeders closed $1.82 higher at $135.72, January feeders closed $1.40 higher at $131.35 and March feeders closed $1.45 higher at $130.97. In respect to cattle producers, thankfully Thursday morning's bullish export report didn't send corn contracts shooting through the roof, and actually nearby corn contracts closed $0.01 to $0.03 lower per bushel. At Ogallala Livestock Auction in Ogallala, Nebraska, compared to a week ago, steers and heifers sold far better. Steers sold anywhere from $2.00 to $8.00 higher and heifers sold $2.00 to $6.00 higher. The CME feeder cattle index for Oct. 28: up $1.02, $134.34.

LEAN HOGS:

While the cattle complex rallied throughout the day, the same can't be said for the lean hog market. Upon rallying to new highs, the market has hit resistance and is slow correcting from the recent run. December lean hogs closed $0.75 lower at $65.62, February lean hogs closed $0.60 lower at $65.60 and April lean hogs closed $0.42 lower at $68.32. Pork cutouts total 282.78 loads with 208.16 loads of pork cuts and 74.62 loads of trim. Pork cutout values: up $3.05, $87.57. Thursday's slaughter is estimated at 492,000 head, steady with a week and year ago. Wednesday's hog slaughter was revised to 485,000 head; butting the new week to date at 1,464,000 head. The CME lean hog index for Oct. 27: down $0.20, $76.27.

Pork net sales of 29,000 mt reported for 2020 were up 8% from the previous week, but down 24% from the prior four-week average. The three primary increases were for Mexico (8,400 mt, including decreases of 1,500 mt), Japan (6,400 mt, including decreases of 200 mt) and South Korea (2,900 mt, including decreases of 400 mt).

Thursday's actual slaughter data shared disappointing news for the week ending Oct. 17. Actual slaughter for the week was down 1.57% compared to the previous week, totaling 2,685,307 head. Live carcass weights averaged 290 pounds (steady with the previous week) and dressed carcass weights averaged 216 pounds (up 1 pound from the week before).

FRIDAY'S CASH HOG CALL: Lower. Seeing that's there's not much support in the lean hog market, packers will buy what they need but won't be in a hurry to support the cash market and get caught paying more for hogs on a down market.

#completecalfcare

Thursday Midday Livestock Market Summary - Cattle Contracts Rally Stronger into Afternoon

 General Comments

With the earlier part of the week's trade being favorable to cattle contracts, concerns that the market's motivation would die off as the later part of the week arrived were valid but thankfully Thursday's trade has grown even more supportive of the cattle contracts! Meanwhile the lean hog complex is trading modestly lower following the morning's disappointing export report. December corn is down 2 1/2 cents per bushel and December soybean meal is up $0.30. The Dow Jones Industrial Average is up 63.12 points and NASDAQ is up 145.59 points.

LIVE CATTLE

As boxed beef prices print higher and nearby contracts scale anywhere from $2.00 to $3.00 higher -- feedlots are soaking up the market's momentum and cherishing the fact that they didn't sell-out early in the week and miss the opportunity to trade cash cattle to their fullest potential. December live cattle are up $2.85 at $107.50, February live cattle are up $2.47 at $110.17 and April live cattle are up $2.02 at $113.40. Bids of $106 are stuck to the table as packers don't want to offer more but feedlots are seeing the market's favor tip their way. In the last hours there's been a handful (very, very few) cattle sold in Texas and Kansas for $106 -- but the rest of the countryside seems willing to wait and hold out for stronger bids. Asking prices in the South hold steady at $108 and asking prices in the North are at $168.

Beef net sales of 18,900 mt reported for 2020 were down 13% from the previous week and 6% from the prior four-week average. The three primary increases were for China (4,300 mt), Japan (4,200 mt, including decreases of 200 mt) and South Korea (4,200 mt, including decreases of 1,500 mt).

Boxed beef prices are higher: choice up $1.50 ($207.29) and select up $1.99 ($191.57) with a movement of 64 loads (35.24 loads of choice, 7.99 loads of select, 6.81 loads of trim and 13.80 loads of ground beef).

FEEDER CATTLE

The feeder cattle market is continuing to press forward and regain some of the position lost last week. November feeders are up $2.70 at $136.60, January feeders are up $1.52 at $131.47 and March feeders are up $1.55 at $131.07. The market was closely watching the corn market Thursday morning as corn export sales were robust and could have sent the complex trading higher. Thankfully the corn market has opted to continue to trade lower which is favorable to cattlemen.

LEAN HOGS

As the livestock market's attention falls to the cattle contracts, the lean hog market is left trading mildly lower into Thursday's afternoon trade. December lean hogs are down $0.70 at $65.67, February lean hogs are down $0.55 at $65.65 and April lean hogs are down $0.42 at $68.32. Unfortunately as the lean hog market has seemed to reach its top, the market is being left high and dry to trade aimless lower.

Pork net sales of 29,000 mt reported for 2020 were up 8% from the previous week, but down 24% from the prior four-week average. The three primary increases were for Mexico (8,400 mt, including decreases of 1,500 mt), Japan (6,400 mt, including decreases of 200 mt) and South Korea (2,900 mt, including decreases of 400 mt).

The projected lean hog index for 10/28/2020 is down $0.80 at $75.49, and the actual index for 10/27/2020 is down $1.20 at $76.29. Hog prices are not available on the National Direct Morning Hog Report due to packer submission problems. Pork cutouts total 145.74 loads with 97.00 loads of pork cuts and 48.74 loads of trim. Pork cutout values: up $5.04, $89.56.

#completeherdhealth

Thursday Morning Livestock Market Summary - Mixed Trade Expected

 General Comments:

Cattle were up, up and away. The increase of futures does not show any real significance on the charts, but the fact that traders are interested in buying after a bearish Cattle on Feed report, provides the feeling that they believe the bottom is in. Increasing futures provides feedlots with the hope of no worse than steady cash prices this week. Bids and offers should surface Thursday with some business expected to be done. The increase of coronavirus cases in the U.S. and European Union is cause for concern over this impact it may have for beef demand from the food service industry. Boxed beef cutout prices continue to struggle.

Hog futures diverged from the cattle Thursday moving lower almost to the same extent as the gains seen in feeder cattle. December and February contracts did not break below the low set on Monday. However, later contracts did move lower, filling the price gaps left on Sept. 10. Technically, this is a good sign. The large decline of futures over the past two weeks has not reached a level to trigger bottom picking. Cutouts took a big hit, adding to the bearishness of the market. Futures are oversold, but not enough to trigger short-covering. Cash is expected lower.

	BULL SIDE		BEAR SIDE
1)	Traders seem to think lower cattle futures were a buying opportunity. This provides more confidence the market had been overdone to the downside and a further price retracement is necessary.	1)	Cattle futures have shown resiliency so far this week but continued higher prices may be a tall order without the support of boxed beef.
2)	Higher futures may bring packers to the table at steady-to-higher bids as they seek to procure sufficient cattle for the week.	2)	Demand may suffer to some extend due to the surge of the coronavirus again as further restrictions on restaurants and catering may have a bearish impact as this may not be offset by an increase in retail demand.
3)	Hog futures are ripe for some short-covering and Thursday and Friday before the weekend. Price support holding in the December and February contracts could increase trader buying interest.	3)	Hog futures are on the very edge of breaking chart support and fill the price gaps remaining in December and February contracts about $1.50 below Wednesday's close.
4)	Lower cutouts should improve demand interest, keeping pork moving. This should establish a bottom as consumers will turn to a less expensive meat with more meals eaten at home.	4)	Pork cutouts are struggling, falling to the lowest levels since mid-September. This provides little incentive for packers to bid higher.

#completecalfcare

Wednesday Closing Livestock Market Summary - Cattle Contracts Beat to Their Own Drum

While nearly all other markets closing lower Wednesday afternoon, cattle contracts were able to march higher and conduct their own rally regardless of how the other markets traded. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.80 with a weighted average of $61.76 on 6,960 head. December corn is down 14 1/2 cents per bushel and December soybean meal is down $7.30. The Dow Jones Industrial Average is down 943.24 points and NASDAQ is down 426.48 points.

LIVE CATTLE:

Keeping in their own world, both the live cattle and feeder cattle contracts closed higher. The live cattle market didn't see as much support as the feeder cattle market did, but both contracts were able to secure profits while outside markets veered lower. December live cattle closed $0.62 higher at $104.67, February live cattle closed $0.67 higher at $107.70 and April live cattle closed $0.65 higher at $111.37. Following Wednesday's delayed FCE, there was some light business that took place in Nebraska but certainly not enough to establish a good trend for the week. There was just a handle of cattle trade in Nebraska for $158 to $160. Wednesday's slaughter is estimated at 118,000 head, 3,000 head less than a week ago and steady with a year ago.

Wednesday's Fed Cattle Exchange was delayed due to technical issues but was still able to host the sale later in the day. The delayed Fed Cattle Exchange Auction listed a total of 2,012 head, of which 1,257 actually sold, 755 head were listed as unsold and none were listed as PO (passed offer). The state-by-state breakdown looks like this: Kansas 512 total head, with 151 head sold at $106.25, 361 head went unsold; Nebraska 394 total head, all of which went unsold; Texas 790 total head, with all 790 head sold at $105.50-$106.25; South Dakota 316 total head, all of which sold at $106.00. The delivery date/weighted averages breakdown is as listed: one- to nine-day delivery: 935 head total, 766 head sold, with a weighted average price of $106.04; one- to 17-day delivery 1,077 head total, 491 head sold, with a weighted average price of $105.80.

Boxed beef prices closed mixed: choice down $0.91 ($205.79) and select up $0.91 ($189.58) with a movement of 173 loads (99.48 loads of choice, 25.40 loads of select, 20.85 loads of trim and 26.91 loads of ground beef).

THURSDAY'S CASH CATTLE CALL: Steady. Seeing that feeders have mostly waited until later in the week to market their cattle, one is led to believe that they are rooting for at least steady prices this week. If the later part of the week can continue the momentum, feeders may be able to hold at least steady prices. If boxed beef prices were rallying, as opposed to scaling lower, the market would be able to do so with ease.

FEEDER CATTLE:

The feeder cattle market had a nice rally throughout Wednesday's trade, capitalizing on traders' willingness to support the market and the corn market's weakness. November feeders closed $1.60 higher at $133.90, January feeders closed $1.52 higher at $129.95 and March feeders closed $1.47 higher at $129.52. Both the November and January feeder cattle contracts are well below the 40- and 100-day moving averages, but this week's progress has been commendable following last week's deterioration. Cattlemen in the North, along with cattlemen in the five-area feeding regions and even down into some of the Southern Plains, are experiencing cold weather and ice storms that are making it hard to truck cattle and host sales. Dodge City, Kansas, shared sharply lower receipts due to weather, and OKC West in El Reno, Oklahoma, canceled their sale as an ice storm blew through and left a lot of the town without electricity and made it extremely dangerous to haul cattle. The CME feeder cattle index for Oct. 27: down $0.32, $133.32.

LEAN HOGS:

The lean hog market is having a mixed week as support is becoming harder to come by and there's more pressure for the market to bow lower. December lean hogs closed $1.27 lower at $66.37, February lean hogs closed $1.85 lower at $66.20 and April lean hogs closed $1.62 lower at $68.75. Wednesday's cutout values were sharply lower, the steep cutback in belly prices has really pushed for the market to trade lower. On Wednesday pork bellies fell $22.31 to $121.58; pork cutouts totaled 438.52 loads with 397.06 loads of pork cuts and 41.47 loads of trim. Pork cutout values: down $5.10, $83.73. Wednesday's slaughter is estimated at 492,000 head, steady with a week ago and 16,000 head more than a year ago. The CME lean hog index for Oct. 26: down $0.70, $77.47.

THURSDAY'S CASH HOG CALL: Lower. With pressure from nearly every angle to trade lower, packers will most likely let the market trade steady to lower as there's ample reasons for the complex to keep cutting away at the market's recent advancement.

#completecalfcare

Wednesday Midday Livestock Market Summary - Feeder Cattle Contracts Paying Close Attention to Corn Prices

 General Comments

The cattle contracts are soaking up this week's support, rallying modestly in the live cattle market and upwards of $1.00 higher in the feeder cattle market. Meanwhile in the lean hog market the contracts keep stair-stepping lower as pressure around resistance levels encourages the market to trade lower. December corn is down 11 1/4 cents per bushel and December soybean meal is down $6.00. The Dow Jones Industrial Average is down 678.49 points and NASDAQ is down 316.80 points.

LIVE CATTLE

The live cattle market is liking the support that is largely stemming from the rally in the feeder cattle market and obvious support from traders that are willing to step back into the market again. December live cattle are up $0.62 at $104.67, February live cattle are up $0.47 at $107.47 and April live cattle are up $0.57 at $111.22. Wednesday's usual cash cattle business didn't go as planned as the Fed Cattle Exchange experienced some technical difficulties and was unable to host their weekly sale. Around midmorning some cash cattle bids did start to lightly develop. There are some cattle bid on in Texas at $104 but asking prices are starkly higher at $108 in the South, and the North has yet to set their prices. Trade is more likely to see develop Thursday and Friday though there could be some mild developments throughout Wednesday afternoon.

Boxed beef prices are mixed: choice down $0.75 ($205.95) and select up $1.16 ($189.83) with a movement of 110 loads (65.52 loads of choice, 15.51 loads of select, 8.42 loads of trim and 20.71 loads of ground beef).

FEEDER CATTLE

Feeder cattle contracts are bound and determined to make a comeback as the market's successfully rallied three days in a row. Wednesday's biggest support is coming from the corn markets hard sell off as December corn falls $0.11 lower per bushel, and March corn is down $0.10 per bushel. November feeders are up $1.37 at $133.67, January feeders are up $1.30 at $129.75 and March feeders are up $1.17 at $129.22. If the market can keep this forward momentum, and see some progress made in the live cattle market - buyers could be somewhat more willing to look at feeder cattle and calves selling this fall.

LEAN HOGS

As the lean hog market scales lower; seeming at the time unwilling to surpass the market's current resistance planes, traders look at the cattle contracts will more interest and leave the hogs to fall lower. December lean hogs are down $1.37 at $66.27, February lean hogs are down $1.92 at $66.12 and April lean hogs are down $1.77 at $68.60. Pork cutouts aren't as hot Wednesday as they were earlier in the week, and with the cash markets lower midday prices, the market sits fully lower heading into Wednesday afternoon. As time passes and we begin to look to Thursday, the week's export report has a way of gravely affecting the pork market. Hog producers obviously hope for a strong report to keep packers vigorously processing and to help move front end supplies.

The projected lean hog index for 10/26/2020 is down $0.70 at $77.47 and the actual index for 10/23/2020 is down $0.37 at $78.17. Hog prices are lower on the National Direct Morning Hog Report, down $1.12 with a weighted average of $61.44, ranging from $58.00 to $63.50 on 5,110 head and a five-day rolling average of $60.62. Pork cutouts total 226.60 loads with 203.84 loads of pork cuts and 22.76 loads of trim. Pork cutouts values: down $0.01, $88.82.

#completeherdhealth

Wednesday Morning Livestock Market Summary - Packers May Become More Aggressive

 General Comments:

Cattle futures performed well Tuesday and have done so since the bearish Cattle on Feed report. The market was oversold and ripe for a retracement. Traders had overdone the market to the downside. Packers are still window dressing, waiting to see what feedlots will offer. Feedlot are not anxious to establish offers now that futures have risen over the past two days. Bids and offers should begin to be posted Wednesday but will likely be the usual few dollars apart. Packers may be loath to bid at even steady prices, but the rise of futures may require them to bend a bit. The concern for the market is the inability of futures to hold strong gains that were posted during the day closed around a dollar off their highs with the exception of front-month October, which finishes trading on Thursday. Boxed beef may not support higher prices, which may limit upside price potential.

Hog futures followed a similar pattern as cattle, closing about a dollar off the highs of the day. December was a different story, posting a price swing of $2.00 and finally closing 10 cents lower. Traders might be content with hog prices and might move futures into a sideways pattern for a short period of time. Packers stepped up to the plate Tuesday with higher bids, but once needs are filled, they will be less aggressive. The China news of lower imports next year is becoming old and tedious news. Traders want to focus on the here and now, and higher cash with lower cutouts keeps the market somewhat neutral.

	BULL SIDE		BEAR SIDE
1)	Feeder cattle have been leading the charge higher, providing some optimism in the market. Live cattle have digested the Cattle on Feed report and have moved to focusing on supply and demand.	1)	Cattle futures have corrected from an oversold market and now may have more difficulty finding new buying interest. Higher cattle numbers are still on traders' minds.
2)	Higher futures may provide more confidence for feedlots to hold for steady-to-higher prices this week. Lower boxed beef is improving demand.	2)	If packers are unwilling to accomplish business at even steady bids, futures may struggle to move much higher. Higher weights and slowing food service demand is not a good combination.
3)	Hogs futures could not hold the highs of the day, but contracts closed higher over the past two days. Traders have taken advantage of the recent lows to get on board to ride the market higher.	3)	The inability of hog futures to hold their highs Tuesday may indicate traders are willing to sell more aggressively at higher prices. Futures achieved a 50% price retracement, which may be difficult to overcome.
4)	Higher cash Tuesday should set the tone for Wednesday with prices expected to be no worse than steady. This will give traders greater confidence to hold long positions in anticipation of a return to the highs.	4)	Lower cutouts may have buyers thinking twice about increasing cash bids Wednesday after their aggressive showing Tuesday.

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Tuesday Closing Livestock Market Summary - Contracts Delight in the Board's Support

Tuesday's trade wasn't a whirlwind by any means, but the day's slow and methodical trade was comfortable and allowed all three livestock markets to close higher. Following last week's bearish trade, a steady market willing to rebuild some positioning is being well received. Hog prices closed higher on the National Direct Afternoon Hog Report, up $2.05 with a weighted average $62.56 on 11,535 head. December corn is down 1 3/4 cents per bushel and December soybean meal is down $5.60. The Dow Jones Industrial Average is down 222.19 points and NASDAQ is up 72.41 points.

LIVE CATTLE:

The live cattle market took Tuesday and mustered up the most support. With cash cattle prices still at a mere standstill and boxed beef prices closing mixed, the market's most significant business for Tuesday was the futures higher close. December live cattle closed $0.65 higher at $104.05, February live cattle closed $0.62 higher at $107.02 and April live cattle closed $1.22 higher at $110.72. Tuesday's slaughter is estimated at 117,000 head, 4,000 head less than a week ago and 4,000 head more than a year ago. Monday's cattle slaughter was revised to 115,000 head.

Boxed beef prices closed mixed: choice down $1.13 ($206.70) and select up $0.18 ($188.67) with a movement of 175 loads (104.81 loads of choice, 25.52 loads of select, 17.21 loads of trim and 27.60 loads of ground beef).

WEDNESDAY'S CASH CATTLE CALL: Steady. It wouldn't be surprising to see cash cattle trade start to develop sometime after Wednesday's Fed Cattle Exchange. If the board will support higher prices, feeders will work to get cattle sold this week for at least steady prices.

FEEDER CATTLE:

Feeder cattle contracts closed fully higher, though they didn't close as high as what the day had traded for earlier. November feeders closed $1.72 higher at $132.30, January feeders closed $1.65 higher at $128.42 and March feeders closed $1.60 higher at $128.05. Helping spark some support for the feeder cattle contracts is simply traders' willingness to jump back into the market and actively trade, along with the corn market's slight regression. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to a week ago, steer and heifers traded mostly $3.00 to $5.00 lower on a limited offering. The area was swept with a cold front that made shipping cattle difficult for this week's sale. The CME feeder cattle index for Oct. 26: down $0.06, $133.64.

LEAN HOGS:

Other than the spot December contract, the lean hog market closed cautiously higher. Helping aid the market along was the industry's stronger cash hog trade, which was over $2.00 higher on more than $11,000 head. December lean hogs closed $0.10 lower at $67.65, February lean hogs closed $0.40 higher at $68.05 and April lean hogs closed $0.30 higher at $70.37.

Pork cutouts total 444.39 loads with 399.34 loads of pork cuts and 45.05 loads of trim. Pork cutout values: down $3.03, $88.83. Tuesday's slaughter is estimated at 492,000 head, 4,000 head more than a week ago and steady with a year ago. Monday's hog slaughter was revised to 487,000 head. The CME lean hog index for Oct. 23: down $0.37, $78.17.

WEDNESDAY'S CASH HOG CALL: Steady to somewhat higher. The cash hog market has been pulling some attention and packers are willing to up their bids and get hogs committed. Following two days of stronger trade, Wednesday's business could support higher prices if the board cooperates, as packers are vigorous about processing right now.

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Tuesday Midday Livestock Market Summary - Cattle Contracts Trading Fully Higher

The livestock complex has repeated the benefits from the support surfacing throughout Tuesday morning's trade. Cattle contracts have steadily traded higher all throughout the day, but the lean hog complex has been a bit touchy -- trading higher and lower throughout the morning. December corn is down 2 1/4 cents per bushel and December soybean meal is down $3.80. The Dow Jones Industrial Average is down 84.96 points and NASDAQ is up 64.04 points.

LIVE CATTLE

With live cattle prices faring better than what was expected, feeders are hopeful to push cash cattle trade to the end of the week and bat for at least steady prices. December live cattle are up $0.30 at $103.70, February live cattle are up $0.15 at $106.55 and April live cattle are up $0.87 at $110.37. The mixed trade in boxed beef prices will still make getting much of a premium off last week's trade difficult as packers are seeing lower retail prices -- but steady trade isn't out of the question. Bids and asking prices are still elusive and it's very likely that this week's trade won't develop until after Wednesday's online auction.

Boxed beef prices are mixed: choice down $0.29 ($207.54) and select up $0.55 ($189.04) with a movement of 119 loads (64.12 loads of choice, 20.62 loads of select, 13.23 loads of trim and 21.18 loads of ground beef).

FEEDER CATTLE

The feeder cattle market took the brunt of last week's downward spiral but come Tuesday the market is taking full advantage of the building support. November feeder cattle are up $2.40 at $132.87, January feeder cattle are up $2.35 at $129.12 and March feeders are up $2.25 at $128.67. Helping support the market is the slight regression in the nearby corn contracts and traders being willing to step back into the market and leave their sideline position. Feeder cattle and calves sold mostly lower throughout the countryside Monday afternoon, but it was interesting to see sale receipts lower than the previous week. As cow-calf producers saw a weaker market they revaluated their marketing strategy, and some decided to wait a little longer for a better market.

LEAN HOGS

Finding support has been touch and go for the lean hog market as cattle contracts seem to be drawing more trader interest. As the lean hog market starts to face some resistance, it makes sense that traders would be more prone to looking at the cattle contracts as they've scaled considerably lower here recently. December lean hogs are steady at $67.75, February lean hogs are up $0.22 at $67.87 and April lean hogs are down $0.10 at $69.97. Following Monday's weaker pork cutout close, Tuesday's midday cutout looks promising for a stronger close, but the market has been facing some regression in cutout values as of late.

The projected lean hog index for 10/23/2020 is down $0.37 at $78.17 and the actual index for 10/22/2020 is down $0.06 at $78.54. Hog prices are higher on the National Direct Morning Hog Report, up $0.81 with a weighted average of $61.32, ranging from $56.00 to $61.32 on 4,276 head and a five day rolling average of $60.08. Pork cutouts total 198.41 loads with 179.42 loads of pork cuts and 18.99 load of trim. Pork cut out values: up $3.03, $94.89.

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