Movements in outside markets continue to spark active trade in the livestock futures through the first half of Friday's trading session, although the direction of trade has generally pointed downward. Feeder cattle future contracts are leading the bearish movement in the sector, with losses of $0.40 to $0.60.
December corn is up 4 3/4 cents per bushel and December soybean meal is up $7.80 per ton. The Dow Jones Industrial Average is down 77 points and NASDAQ is up 10.29 points.
Although there continues to be strength in the cash cattle market and in the packing industry and at the retail counter, it's not enough to pull cattle futures higher this week. The February live cattle contract is down $0.425 at $114.50; the April contract is down $0.15 at $119.35; and the June contract is down $0.025 at $115.35. After a relatively active morning of futures trade, the contracts look headed for a lower weekly close, although this pullback so far leaves the February contract within $2 of its post-Christmas high at $116.30.
Boxed beef prices are higher: choice up $0.74 ($206.55) and select up $0.33 ($196.92) with a movement of 176 total loads (112 loads of choice, 21 loads of select, 14 loads of trim and 28 loads of ground beef).
Once the feed markets turned back higher Friday, feeder cattle futures turned back lower, with the January feeder cattle contract down $0.525 at $136.175, the March contract down $0.45 at $137.125, and the April contract down $0.30 at $139.375 as of midday. The trading range has remained tight so far during this session, with no one appearing interested in testing more of a recovery while the rest of the livestock sector is stuck in mostly bearish trade, and consolidation looks to be the most likely path forward for feeder cattle futures.
The February lean hog futures contract is down $0.425 at $68.00, the April contract is down $0.175 at $72.875, and the June contract is down $0.10 at $77.825. There have been some patches of fast trade through the session, perhaps triggered by outside market volatility, with the U.S. Dollar Index bouncing back upward above the 90 level. A bearish dollar is supportive to agricultural exports like U.S. pork, and although pork exports continue to be a bright spot of support for this market, with the February contract unable to break above $72 and now dipping as low as $68.325 Friday, this market may be relying on all the help it can get.
The projected lean hog index for 1/7/2021 is up $0.38 at $63.34, and the actual index for 1/6/2021 was up $0.54 at $62.96. Pork cutouts Friday morning total 213.56 loads with 180.57 loads of pork cuts and 32.99 loads of trim. Pork cutout values: up $7.48, $87.30.