GENERAL COMMENTS:
Heading into Thursday's trade, both the live cattle and lean hog markets will anxiously be awaiting Thursday's export report. The cash cattle market should see interest increase from packers, but trade could be delayed until Friday. Hog prices were lower on the National Direct Afternoon Hog Report, down $0.86 with a weighted average of $56.30 on 5,417 head. December corn is up 4 1/4 cents per bushel, and December soybean meal is up $7.20. The Dow Jones Industrial Average is down 211.17 points, and the NASDAQ is down 52.29 points.
LIVE CATTLE:
Sure, there were some cattle that traded throughout the day at $132 live and at $207 dressed -- but, by and large, feedlots sent packers back to the drawing board when they pitched their steady bids, as feedlots are eager to push the cash cattle market higher again this week. With showlists current and the board trading positively, feedlots see the market signaling for them to stick to their guns and demand higher prices while they hold some of the market's leverage. And while it may seem burdensome that boxed beef prices are drifting lower, we must remember that this year has been anything but "usual" for beef prices, and at some point, they were going to have to correct. December live cattle closed $0.50 higher at $132.22, February live cattle closed $0.30 higher at $136.40, and April live cattle closed $0.47 higher at $140.27. Heading into Thursday's trade, the market is looking for cash cattle interest to strengthen, and it's more likely than not that feedlots succeed in pushing the market higher again this week. If the week's export report is supportive, then there really should be no hiccup in finding higher ground for the cash market, as supplies of market-ready cattle are thin.
Wednesday's slaughter is estimated at 122,000 head -- steady with a week ago and 5,000 head more than a year ago.
The Fed Cattle Exchange Auction listed a total of 1,973 head, of which 308 actually sold, none were scratched from the auction and 1,665 head were listed as unsold, as they did not meet the reserve prices, which ranged from $132 to $133. Opening prices ranged from $130 to $131, high bids ranged from $131 to $132.25. The state-by-state breakdown looks like this: Texas 1,468 total head, all of which went unsold; Nebraska 505 total head, with 308 head sold at $132, and 197 head went unsold.
Boxed beef prices closed lower: choice down $3.66 ($278.47) and select down $2.53 ($264.06) with a movement of 188 loads (107.74 loads of choice, 44.67 loads of select, 5.13 loads of trim and 30.07 loads of ground beef).
THURSDAY'S CASH CATTLE CALL: $1 to $2 higher. Plain and simple, supplies of market-ready cattle are thin, and packers are running fast chain speeds, so feedlots should be able to push this week's cash cattle market higher once again.
FEEDER CATTLE:
The corn market did indeed close $0.04 higher in the nearby contracts, but the vigor and might from the live cattle complex lent the feeder cattle contracts enough support to round out the day mostly higher. January feeders closed $0.35 lower at $158.92, March feeders closed $0.20 higher at $161.10 and April feeders closed $0.30 higher at $163.72. If the cash cattle market can push prices higher come Thursday or Friday, the feeder cattle complex may be able to keep this modest rally going if the corn market doesn't rally full steam ahead. There's pressure at $160 that's going to cause the January feeder cattle market some grief as the complex is teetering on not knowing which external factor is going to sway the market (higher corn, or higher cattle). But in order to take on the resistance at $160, the market will need unwavering support and no hesitation. At Ozarks Regional Stockyard in West Plains, Missouri, compared to last week, steer calves traded steady to $3 higher, and heifer calves traded steady to $3 lower. The CME feeder cattle index 11/16/2021: down $0.01, $155.48.
LEAN HOGS:
The upcoming 2022 market beams with potential, and traders are willing to invest in the year ahead, as they're hopeful that the market's wishes do come true. With there being a chance that export opportunities lie ahead for the market with African swine fever continuing to spread and the potential that pork plants could run faster chain speeds, traders see pork cutouts finding higher ground, and hog producers see front-end supplies potentially achieving currentness. But dreaming about a "better" marketplace is the easy part! Nevertheless, Wednesday's market wasn't nearly as friendly to the hog complex from a fundamental point of view. Wednesday's slaughter was aggressive, but pork cutouts fell sharply lower, and there were just over 5,000 head of hogs bought in the cash market. December lean hogs closed $1.55 lower at $76.17, February lean hogs closed $0.22 lower at $83.15, and April lean hogs closed $0.15 higher at $87.52. Looking ahead to Thursday, the market's ability to have a positive day will largely rest on the outcome of the export report. The market will not only be looking to see how much volume was shipped, but also on whether China was a significant buyer in the market. Pork cutouts totaled 384.41 loads with 317.59 loads of pork cuts and 66.81 loads of trim. Pork cutout values: down $3.25, $84.52. Wednesday's slaughter is estimated at 484,000 head -- 6,000 head more than a week ago and 9,000 head less than a year ago. The CME lean hog index 11/15/2021: up $0.16, $76.33.
THURSDAY'S CASH HOG CALL: Lower. Supplies of market-ready hogs aren't limited, pork cutout values nosedived $3 lower, and next week is a shortened holiday week -- it's unlikely that packers get carried away in this week's cash hog market.
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