GENERAL COMMENTS:
Both live and feeder cattle futures are rallying into Wednesday afternoon trade, no longer fearing the market, and instead looking to re-spark their rally. The lean hog market isn't as lucky as its contracts are trending lower, but the futures are thankful to continue to see the packers fully support the cash market. March corn is up 7 1/4 cents per bushel and January soybean meal is up $10.10. The Dow Jones Industrial Average is up 367.73 points and NASDAQ is up 187.25 points.
LIVE CATTLE:
Packers were hoping the futures would continue their downward descent throughout the day and give them the chance to bid steady prices and worry feedlots. But with the recent gain in leverage that feedlots have secured, they're much more confident in demanding higher prices and sit in a fine position regarding their showlists to demand more money. Bids of $138 are on the table all throughout the five-state feeding region, but thus far feedlots haven't paid them any attention. Asking prices in the South are noted at $143-plus and still the North has yet to disclose what they're asking. It's likely $138 won't be sufficient to get cattle bought this week and packers are going to have to flop open their checkbooks with more aggressive bids. December live cattle are up $0.70 at $136.57, February live cattle are up $1.02 at $138.92 and April live cattle are up $1.07 at $142.17.
The Fed Cattle Exchange Auction listed a total of 1,868 head (Texas 1,727 head, Kansas 141 head), none of which actually sold as they did not meet the reserve prices, which ranged from $140 to $141. Opening prices ranged from $137.50 to $138; high bids ranged from $138 to $139.
Boxed beef prices are lower: choice down $0.60 ($271.08) and select down $0.75 ($259.54) with a movement of 140 loads (108.94 loads of choice, 11.67 loads of select, 4.89 loads of trim and 14.38 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures are rallying after trading lower earlier this week. January feeders are up $0.45 at $165.32, March feeders are up $1.00 at $167.47 and April feeders are up $1.22 at $170.05. Even though the futures market was softer on both Monday and Tuesday, that didn't dampen demand whatsoever throughout the countryside. With last week's fat cattle market championing $140, buyers are anxious to fill their pens as they see the 2022 market being rewarding. Corn prices are posting a modest 6- to 7-cent rally in the nearby contracts, so if the live cattle market doesn't offer support, the feeder cattle complex could grow wary over higher inputs.
LEAN HOGS:
The lean hog complex hasn't performed as strong as it had hoped for this week from a technical sense, but still packers are chasing the cash market. It's likely packers are aggressively running after hogs as they want to get their inventory stocked before the Christmas and New Year holidays. With holiday buying on the verge of being done, pork cutouts could face more pushback as retailers coast into the New Year. From a demand sense, a strong export report could help the market tremendously as it would help move front-end product and give the market a much-needed gust of support. December lean hogs are up $0.02 at $73.45, February lean hogs are down $0.42 at $79.55 and April lean hogs are down $0.55 at $84.70.
The projected CME Lean Hog Index for 11/30/2021 is up $0.23 at $70.27, and the actual index for 11/29/2021 is down $0.56 at $70.04. Hog prices are higher on the National Direct Morning Hog Report, up $0.26 with a weighted average of $55.68, ranging from $54.00 to $59.00 on 4,968 head and a five-day rolling average of $55.29. Pork cutouts total 195.31 loads with 160.89 loads of pork cuts and 34.42 loads of trim. Pork cutout values: down $1.18, $85.52.
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