GENERAL COMMENTS:
Monday had a shaky start, but as the day progressed traders invested in the livestock contracts and ultimately allowed for a stronger close. Heading into the shortened holiday week, it wouldn't be unlikely to see support develop early this week and then fade away as Christmas nears. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.26 with a weighted average of $50.58 on 6,750 head. March corn is up 2 1/2 cents per bushel and January soybean meal is up $6.80. The Dow Jones Industrial Average is up 37.40 points and NASDAQ is down 13.12 points.
LIVE CATTLE:
Monday's generosity carried into the live cattle contracts and allowed for nearby every contract to close higher. December live cattle closed $0.12 stronger at $110.60, February live cattle closed $0.20 lower at $114.65 and April live cattle closed $0.05 higher at $118.70. Potentially most exciting to see (other than nearby contracts breaking through short-term resistance) was the strong close in the boxed beef prices. As the market looks to the new year, beef demand seems to have found a bottom and is ready to trade higher. Monday's cash cattle trade was as one would expect, at an utter standstill, as asking prices have yet to surface and no bids have hit the table. Feeders are anticipated to price cattle $1.00 to $2.00 higher this week and even higher next week. Seeing that Thursday is Christmas Eve, we most likely will see this week's trade develop something over Tuesday and Wednesday. Monday's slaughter is estimated at 119,000 head, 1,000 head less than a week ago and 2,000 head more than a year ago.
Boxed beef prices closed higher: choice up $2.29 ($210.92) and select up $2.99 ($197.26) with a movement of 110 loads (70.96 loads of choice, 16.40 loads of select, 13.62 loads of trim and 8.57 loads of ground beef).
TUESDAY'S CASH CATTLE CALL: $1.00 to $2.00 stronger. With the Southern Plains being able to keep last week's market elevated, and with boxed beef prices taking a run at higher prices, feedlots have their hopes set on a stronger market heading into 2021.
FEEDER CATTLE:
The support in the feeder cattle market has been stellar over the last week and Monday's trade didn't disappoint the ambitious marketplace. January feeders closed $0.17 higher at $140.62, March feeders closed $0.82 higher at $143.12 and April feeders closed $0.85 stronger at $144.75. The market may see some softness develop as the week progresses and feeder cattle sales wrap up for the year. There are some sales scheduled for Tuesday and Wednesday of this week, but largely those sales will be the last ones for the year. At Joplin Regional Stockyards in Carthage, Missouri, compared to a week ago, steer calves sold steady, while heifers sold steady to $2.00 higher. Demand was moderate while supplies were heavy for the last sale of the year. The CME feeder cattle index for Dec. 18: up $1.08, $139.56.
LEAN HOGS:
The lean hog contracts managed to close the day higher, but even better yet, Monday even had a successfully higher close in both the midday and closing pork cutout value. February lean hogs are up $0.12 at $65.92, June lean hogs are up $0.25 at $81.02 and July lean hogs are up $0.27 at $81.67. The market needs fundamental support in order to keep trading higher. Monday's cash hog trade was lower but that's to be excepted given that it's a shortened holiday week. The market's biggest hope is that pork cutout values continue to scale higher and give the market the extra confidence and support that it needs. Pork cutouts total 378.07 loads with 345.13 loads of pork cuts and 32.94 loads of trim. Pork cutout values: up $0.87, $72.34. Monday's slaughter is estimated at 487,000 head, 2,000 head less than a week ago and 9,000 head less than a year ago. Friday's hog slaughter was revised to 476,000 head. The CME lean hog index Dec. 17: down $0.67, $63.72.
TUESDAY'S CASH HOG CALL: Lower. Seeing that this week will be cut short for Christmas, it's unlikely that packers are going to be keen on moving the cash market higher before a holiday.
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