GENERAL COMMENTS:
Heading into Friday afternoon, the cattle complex's focus will be on how placements fare in Friday afternoon's Cattle on Feed report. The lean hog complex isn't expected to do much more than continue its descend, but noting how the day's pork cutout value closes out is important. December corn is up 5 3/4 cents per bushel and December soybean meal is down $7.30. The Dow Jones Industrial Average is down 246.63 points.
LIVE CATTLE:
The live cattle market is trending modestly higher into Friday's afternoon as the market recovers somewhat after Thursday's sharply lower end. On Thursday afternoon, the livestock complex dealt with outside pressures, but the market was still able to trade cash cattle, and Friday's market hasn't forgotten that key fundamental win. A light trade developed Thursday afternoon with Southern live cattle traded at mostly $142, which his $2.00 higher than last week's weighted average, and Northern dressed cattle sold for mostly $234, which is $4.00 higher than last week's weighted average. The big questions remaining this week are: How many cattle traded, what delivery option where they bought with, and how are packers going to manage processing speeds moving ahead? There are a couple of plants rumored to be dark next week, which could be packers' way of slowing down throughput. Nevertheless, front-end supplies are extremely thin, and feedlots possess a lion's share of the market's leverage as packers want to continue a relatively strong processing pace as boxed beef prices are still rewarding, and international demand is strong. August live cattle are up $0.35 at $141.62, October live cattle are up $0.57 at $145.32 and December live cattle are up $0.42 at $150.97.
Friday's Imported Meat for Entry Into the U.S. report shared that fresh beef imports totaled 21,569 metric tons, which Canada, Mexico, New Zealand and Brail carrying the lion's share of the business (up 11% from a year ago). Processed beef imports totaled 1,782 metric tons (up 22% from a year ago).
Boxed beef prices are higher: choice up $0.12 ($264.51) and select up $0.72 ($238.19) with a movement of 34 loads (16.69 loads of choice, 9.07 loads of select, zero loads of trim and 8.20 loads of ground beef).
FEEDER CATTLE:
As the corn complex sports a $0.04 to $0.06 rally heading into Friday afternoon, the feeder cattle contracts are trending lower without much excitement being noted in their market. Aside from corn trending slightly higher, potentially the biggest reason feeder cattle could be trading lower heading into Friday's afternoon is because there are concerns that Friday afternoon's Cattle on Feed report could be bearish on placements. Given the big liquidation push that came in Texas during the month of July, it's likely that placements are higher than what analysts assumed which would cast a bearish tone over the report. However, even with higher placements, the market could see a couple days' worth of doggish trade, but the reports won't likely derail the strong technical support that the market possesses nor the demand that feeder cattle and calves are seeing. August feeders are up $0.17 at $181.70, September feeders are down $0.52 at $184.75 and October feeders are down $0.77 at $186.90.
LEAN HOGS:
The lean hog complex continues to barrel lower as the market has come under immense technical pressure. As the pork cutout value shows signs of exhaustion, traders are sending the contracts lower as they believe that the market's nearby days of running higher could be over. October lean hogs are down $0.05 at $93.22, December lean hogs are down $1.32 at $83.87 and February lean hogs are down $1.87 at $86.92. The belly has been the pork cutout values swinging variable and, as of late, whiplash-like drastic changes have sent prices all over the place, but weaker tones are the markets main driver.
The projected lean hog index for Aug. 18 is down $0.31 at $120.29 and the actual index for Aug. 17 is down $0.02 at $120.60. Hog prices are lower on the Daily Direct Morning Hog report, down $2.77 with a weighted average of $116.35, ranging from $113.50 to $129.00 on 3,198 head and a five-day rolling average of $123.43. Pork cutouts total 121.68 loads with 105.14 loads of pork cuts and 16.55 loads of trim. Pork cutout values: up $0.05, $118.52.
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