GENERAL COMMENTS
It was a mixed day for the livestock complex as the contracts closed mostly lower but neither the live cattle nor feeder cattle threw away all that Monday accomplished. Wednesday's focus will be the cash cattle market and what feedlots accomplish this week. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $3.14 with a weighted average of $85.30 on 10,051 head. December corn is down 2 3/4 cents per bushel and December soybean meal is down $2.80. The Dow Jones Industrial Average is up 397.82 points.
Tuesday's Cold Storage report shared that total red meat supplies in freezers were down 4% from the previous month, but up 11% from last year. Total pounds of beef in freezers were down 3% from the previous month but up 8% from last year. Frozen pork supplies were down 5% from the previous month, but up 16% from last year. Stocks of pork bellies were up 10% from last month and up 246% from last year. Total stocks of chicken were up 2% from last up and up 18% from last year. Total pounds of turkey in freezers were 32% from last month and down 12% from Oct. 31,2021.
LIVE CATTLE:
The live cattle complex drew back as Tuesday's end neared, and as traders seem to be looking for reassurance in this week's cash cattle market before they'll advance the complex any higher. It was impressive, however, that, in both the live cattle and feeder cattle markets, traders didn't panic and opt to trade lower throughout Tuesday's market to fill in the gap created by Monday's strong open. It is assumed that cash cattle prices will indeed be higher this week as front-end supplies are current and as packers are short bought. Some bids of $242 to $245 were offered in Nebraska Tuesday morning, but largely feedlots let those bids sit idle as they're looking for more. Asking prices for cattle in the South are noted at $154 to $155 and are still unknown in the North. Some light trade developed throughout the day, but largely it wasn't enough to say that any sort of a trend was established. Both cattlemen and traders will be looking to Wednesday's market for more answers on how this week's cash cattle trade will shake out. December live cattle closed $0.25 higher at $153.80, February live cattle closed $0.30 lower at $156.42 and April live cattle closed $0.22 lower at $159.90.
Tuesday's slaughter is estimated at 129,000 head, steady with a week ago and 5,000 head more than a year ago.
Boxed beef prices closed higher: choice up $1.06 ($256.63) and select up $0.95 ($234.18) with a movement of 157 loads (107.71 loads of choice, 17.30 loads of select, 7.12 loads of trim and 23.43 loads of ground beef). The choice/select spread sits at $22.45.
WEDNESDAY'S CATTLE CALL: $1.00 to $2.00 higher. With supplies of market-ready cattle thin -- and packers in need of cattle -- prices will likely be higher.
FEEDER CATTLE:
One would have hoped that, with the corn complex closing lower, feeders would have capitalized on the day's opportunity and closed higher, but even though that wasn't the story that played out through Tuesday's market, it was still impressive that traders didn't collapse and fill the gap made by Monday's open. January feeders closed $0.95 lower at $181.67, March feeders closed $0.52 lower at $184.57 and April feeders closed $0.12 lower at $187.92. It's not so much that traders didn't believe in pushing the market higher, but rather instead that they were looking for followed through support from the live cattle market (and more so the cash cattle market) before advancing the complex any higher. If the corn market continues to chop sideways and the momentum in the live cattle market continues to build, then there's upside in this market for feeders to chase after. Joplin Regional Stockyards in Carthage, Missouri, on a run of close to 12,000 head, feeder steers traded steady to $3.00 higher, and feeder heifers traded steady to $4.00 higher. Feeder cattle supply over 600 pounds was 78%. The CME Feeder Cattle Index for Nov. 21: steady, $174.64.
LEAN HOGS:
The lean hog complex skated by and was able to keep a mixed position ahead of Tuesday's end. The demand in the cash market helped the spot December contract close higher, but the lower close in pork cutout values hinders the market's moral. December lean hogs closed $0.45 higher at $84.25, February lean hogs closed $0.07 lower at $90.07 and April lean hogs closed $0.07 higher at $95.55. It's not surprising to see pork cutout values lower as supplies in cold storage is vast, especially for bellies. Pork cutouts totaled 264.92 loads with 231.01 loads of pork cuts and 33.91 loads of trim. Pork cutout values: down $0.69, $91.30. Tuesday's slaughter is estimated at 492,000 head, 3,000 head less than a week ago and 9,000 head more than a year ago. The CME Lean Hog Index for Nov. 18: down $0.80, $86.97.
WEDNESDAY'S HOG CALL: Steady to somewhat higher. The cash market could see some more interest on Wednesday, but then it's likely that the week's cash trade is all but over for the hog market.
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