GENERAL COMMENTS:
Traders were leery of overly supporting the hog complex with pork demand being volatile, but the cattle contracts rallied on the fact that corn trended lower throughout the day. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.31 with a weighted average price of $102.00 on 6,487 head. December corn is down 4 1/2 cents per bushel and December soybean meal is down $3.20. The Dow Jones Industrial Average is down 191.13 points.
LIVE CATTLE:
The live cattle complex closed higher as traders noted the slight decline in corn prices and believe that cash prices could remain steady this week with the added support of slightly higher boxed prices. There was a bid of $295.00 offered throughout the day in Nebraska, but, largely, feedlots let its offer sit idle as they're hoping for more. Trade could begin to develop on Thursday, but it's also not unlikely that trade could be delayed until Friday at this point either. August live cattle closed $0.87 higher at $180.57, October live cattle closed $0.80 higher at $181.70 and December live cattle closed $0.30 higher at $185.50.
Wednesday's slaughter is estimated at 122,000 head, 1,000 head less than a week ago and 4,000 head less than a year ago.
Boxed beef prices closed higher: choice up $1.13 ($303.52) and select up $1.98 ($278.14) with a movement of 125 loads (66.51 loads of choice, 24.45 loads of select, 17.92 loads of trim and 15.92 loads of ground beef).
THURSDAY'S CATTLE CALL: Steady. With packers being able to get cattle bought last week with time, it's likely that cash prices hold steady this week.
FEEDER CATTLE:
The feeder cattle contracts were finally able to close higher thanks to mild support from the live cattle complex as its market also closed higher, and from the fact that corn prices rounded out the day lower. August feeders closed $1.15 higher at $247.15, September feeders closed $1.20 higher at $250.62 and October feeders closed $0.92 higher at $252.15. So long as the current market's environment continues (strong cash cattle trade, good beef demand and steady to weaker tones in the corn market) feeders should be able to continue to thrive at these price points. At Kingsville Livestock Auction in Kingsville, Missouri, compared to last week, both steers and heifers sold steady to $5.00 higher. Slaughter cows traded $2.00 to $4.00 higher and slaughter bulls sold steady. Feeder cattle supply over 600 pounds was 58%. The CME Feeder Cattle Index for Aug. 8: down $0.06, $244.96.
LEAN HOGS:
Traders were onto something when they elected to remain extremely cautious in Wednesday's trade when it came to the lean hog complex, as pork cutout values closed almost $3.00 lower. At this point, the resistance at $85.00 is seeming too much for the market to bear and it's likely that traders keep below that threshold in the spot October contract. Mild losses were seen throughout all the cuts on the pork cutout report, but the belly did suffer majorly as it fell $9.79 itself. October lean hogs closed $3.00 lower at $81.57, December lean hogs closed $2.10 lower at $75.02 and February lean hogs closed $1.67 lower at $79.32. Pork cutouts totaled 242.75 loads with 213.89 loads of pork cuts and 28.85 loads of trim. Pork cutout values: down $2.97, $109.12. Wednesday's slaughter is estimated at 468,000 head - steady with a week ago and 6,000 head less than a year ago. The CME Lean Hog Index for Aug. 7: down $0.46, $104.58.
THURSDAY'S HOG CALL: Steady to somewhat lower. Packers will likely try to keep a lid on cash prices given that pork cutout values are lagging, but it's likely that they still need to buy more hogs this week.
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