The live cattle contracts are taking front and center stage as the lean hog and feeder cattle contracts scale lower but the live cattle market trades modestly higher. As the week trades at its halfway point, the first full week of the New Year has been a challenging one as contracts are volatile and easily swayed. The cash cattle market is still quiet without any bids hitting the marketplace as of yet. March corn is up 2 cents per bushel and March soybean meal is up $5.70. The Dow Jones Industrial Average is up 496.14 points and NASDAQ is up 71.43 points.
For the most part the live cattle contracts are keeping with their trend and aim to trade higher into Wednesday's afternoon trade so long as support continues to help the contracts do so. There's some minor pressure pushing the nearby contracts to trade lower but overall, the market continues to defend its modest gains. February live cattle are down $0.27 at $114.77, April live cattle are down $0.05 at $119.05 ad June live cattle are up $0.20 at $114.87. While the futures market fights to trade higher, the cash cattle market still sits idly without any action developing. Asking prices of $114 to $115 still hold in the South and the North is yet to share their asking though $180 has been noted from feedlots in eastern Nebraska. If the board can keep its strength, it will surely help the cash cattle market achieve their desired $1.00 to $2.00 stronger.
The Fed Cattle Exchange Auction today listed a total of 1,142 head, of which 42 head sold (reserve was not met, but seller accepted high bid), reserve prices ranged from $113 to $114. Opening prices started at $109, high bids ranged from $109 to $112.25. The state by state breakdown looked like this: Kansas 62 total head; Nebraska 64 total head; Texas 974 total head, of which 42 head sold at $112; Oklahoma 42 total head.
Boxed beef prices are mixed: choice down $0.62 ($205.28) and select up $0.13 ($196.62) with a movement of 134 loads (82.02 loads of choice, 33.10 loads of select, 8.43 loads of trim and 10.87 loads of ground beef).
Even though the live cattle market is trading mildly higher and the corn market has slowed its progression to only trading $0.01 higher in nearby contracts, the pressure continues to push the feeder cattle contracts lower. January feeders are down $1.05 at $135.62, March feeders are down $0.85 at $136.57 and April feeders are down $0.75 at $138.62. Thankfully buyers have still been aggressive throughout the countryside in buying calves even with the market's mixed jitters to the New Year's opening trade.
The pressure at $72.00 has pushed the lean hog contracts to trade lower despite the contracts being able to trade higher both Monday and Tuesday. February lean hogs are down $1.15 at $69.77, April lean hogs are down $1.00 at $73.10 and June lean hogs are down $0.47 at $83.72. The market's lower push not only comes from resistance levels on the board but also from the sharply lower cash hog trade which adds a weaker undertone to the market.
The projected lean hog index for 1/5/2020 is up $0.95 at $62.42 and the actual index for 1/4/2020 is up $0.85 at $61.47. Hog prices are lower on the National Direct Morning Hog Report, down $2.42 with a weighted average of $52.85, ranging from $44.00 to $57.40 on 7,560 head and a five-day rolling average of $53.59. Pork cutouts total 273.45 loads with 252.85 loads of pork cuts and 20.60 loads of trim. Pork cutout values: down $0.91, $76.72.