GENERAL COMMENTS:
The livestock complex is trading mixed as the feeder cattle contracts are celebrating the corn market's lower turn, but both the live cattle and lean hog markets are facing some pushback at the noon hour. December corn is down 11 1/2 cents per bushel and December soybean meal is down $2.80. The Dow Jones Industrial Average is down 99.58 points.
LIVE CATTLE:
The live cattle complex is trading mixed into Wednesday's afternoon as the market would like to again trade higher in its nearby contracts, but it's going to need to see how the cash market performs before doing so. December live cattle are down $0.75 at $151.20, February live cattle are down $0.55 at $154.70 and April live cattle are down $0.50 at $158.37. Some early bids could be offered as early as Wednesday afternoon by packers, but it's unlikely that any sizeable trade develops until Thursday's dawn. With feedlots sitting in a cushy position with current showlists and extremely green front-end supplies, everyone in the cattle business knowns that feedlots sit in the driver's seat of today's cash market. Early asking prices are noted in the South at $152 to $153 but are still unestablished in the North. Higher prices are what the industry expects, but the real question is: How much higher will they be this week?
The Fed Cattle Exchange Auction held today reported 7 lots (5 lots in Texas and 2 lots in Kansas), totaling 1,090 head of cattle, none of which sold. Opening prices were at $148, high bids had a range of $148 to $149.25, but none of these bids met reserve prices of $151 to $152.
Boxed beef prices are higher: choice up $0.79 ($263.42) and select up $2.28 ($235.01) with a movement of 93 loads (49.56 loads of choice, 24.06 loads of select, 11.31 loads of trim and 7.75 loads of ground beef).
FEEDER CATTLE:
The shift between the corn complex and the feeder cattle market has been a positive one for cattlemen as the corn market's $0.10 regression into Tuesday's afternoon is finally allowing for the feeder cattle contracts to breathe with ease. As the contracts set out to regain some of the market share that was recently lost, the entire complex is trading well over $1.00 higher into Wednesday's afternoon. November feeders are up $1.85 at $178.75, January feeders are up $1.87 at $180.02 and March feeders are up $1.37 at $182.07.
LEAN HOGS:
Tuesday's poor performance in pork cutouts has the lean hog contracts trending lower into Wednesday's afternoon as the technical side of the market yearns for more fundamental support. Not helping matters is the fact that cash hog prices are lower too at midday. It's likely that packers become more aggressive as the day heads into its afternoon, but it is odd to see midday prices lower when packers have yet to really dive into the cash market. December lean hogs are down $1.52 at $83.67, February lean hogs are down $1.10 at $87.35 and April lean hogs are down $0.87 at $92.72.
The projected lean hog index Nov. 1 is down $0.46 at $93.29 and the actual index for Oct. 31 is down $0.04 at $93.75. Hog prices are lower on the Daily Direct Morning Hog Report, down $0.53 with a weighted average of $87.18, ranging from $84.00 to $95.00 on 5,590 head and a five-day rolling average of $88.54. Pork cutouts total 182.32 loads with 160.52 loads of pork cuts and 21.80 loads of trim. Pork cutout values: up $0.12, $97.33.
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