GENERAL COMMENTS
It was a non-eventful day for the livestock complex as the grain market gained a second wind early in the day, pushing the cattle contracts lower and the lean hog market traded only mildly higher. Hog prices closed higher on the Daily Direct Morning Hog Report, up $1.41 with a weighted average of $89.75 on 8,506 head. December corn is up 6 1/4 cents per bushel and December soybean meal is down $3.30. The Dow Jones Industrial Average is down 79.75 points.
LIVE CATTLE:
The live cattle complex traded higher at Tuesday's start, but with the onset of higher grain prices, the market quickly turned red. December live cattle closed $0.052 lower at $151.95, February live cattle closed $0.57 lower at $155.25 and April live cattle closed $0.20 lower at $158.87. After reaching new contract highs last week, the live cattle market has seemed to grown stale, backing away from its new, recently found highs. The market still sits strong fundamentally, but traders are showing a lack of enthusiasm. The cash cattle complex didn't see any cattle trade through Tuesday's market and it's likely that nothing trades ahead of Thursday as feedlots press on for higher prices. Asking prices are noted in the South for $152 and are still unestablished in the North.
Tuesday's slaughter is estimated at 128,000 head, 1,000 head less than a week ago and 5,000 head more than a year ago.
Boxed beef prices closed lower: choice down $1.02 ($262.63) and select down $1.73 ($232.73) with a movement of 132 loads (82.10 loads of choice, 31.62 loads of select, 4.84 loads of trim and 13.78 loads of ground beef). The choice/select spread sits at $29.90.
WEDNESDAY'S CATTLE CALL: Higher. It's unlikely that cattle begin to trade on Wednesday, but when they do, higher prices aren't out of the market's reach.
FEEDER CATTLE:
The feeder cattle complex closed lower as the corn market closed $0.05 to $0.06 higher in its nearby contracts and the soybean market closed $0.26 to $0.28 higher, both putting immense pressure on feeders. Unfortunately, any sort of higher trade in the grain sector is enough pressure to push the feeder cattle contracts lower as cost of gains are extremely high this year. November feeders closed $0.70 lower at $176.92, January feeders closed $1.25 lower at $178.20 and March feeders closed $0.87 lower at $180.70. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week, feeder steers traded $1.00 to $2.00 higher, but weights over 800 pounds were not well tested. Feeder heifers traded mostly steady. Steer calves sold $5.00 to $10.00 higher and heifer calves traded steady to $4.00 higher with the biggest advancement seen on those weighing 500 pounds or more. Feeder cattle supply over 600 pounds was 36%. The CME Feeder Cattle Index for Oct. 31: down $0.51, $176.97.
LEAN HOGS:
It was a mixed day for the lean hog market as the futures complex was able to cling to a steady to somewhat higher close, but the market's fundamentals were hit or miss through the day's end. Cash hog prices were higher, which will somewhat offset the market's lower note in pork cutout values, but still, traders and packers will both be watching pork demand throughout the later part of the week. Pork cutout values were pulled lower as the ham fell $6.79 from Monday's price, and the butt fell $3.88 and the loin fell $2.65. December lean hogs closed $0.27 higher at $85.20, February lean hogs closed steady at $88.45 and April lean hogs closed steady at $93.60. Pork cutouts totaled 336.72 loads wit 304.18 loads of pork cuts and 32.54 loads of trim. Pork cutout values: down $2.73, $97.21. Tuesday's slaughter is estimated at 489,000 head, 1,000 head less than a week ago and 8,000 head more than a year ago. Monday's hog slaughter was revised to 486,000 head. The CME Lean Hog Index for Oct. 28: up $0.02, $93.79.
WEDNESDAY'S HOG CALL: Higher. With the onset of slightly higher cash prices through Tuesday's end, the cash hog market will likely trade higher come Wednesday as packers will need to procure hogs for upcoming kills.
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