GENERAL COMMENTS:
Wednesday ended up being a better day than originally thought, as the cattle complex closed higher thanks to the support of the cash cattle market. Come Thursday, the market's focus will be on the midmorning WASDE report and on the cash cattle market. Hog prices closed higher on the Daily Direct Morning Hog Report, up $0.34 with a weighted average price of $74.30 on 3,231 head. December corn is up 2 1/2 cents per bushel and December soybean meal is down $0.40. The Dow Jones Industrial Average is down 3.74 points.
LIVE CATTLE:
It was a strong day for the live cattle complex as the market fought technical hesitation and persevered through fundamental support, which came as the cash cattle market started to note some stronger trade. Around the noon hour, the market wasn't looking overly optimistic but as feedlots in the South began to trade cattle for $183 -- which is $1.00 higher than last week's weighted average -- trader morale changed. Bids are currently being offered in the North at $183 to $185 but still no sales have been noted as feedlots are holding out for more. More trade will develop ahead of the week's end, and if Thursday's WASDE report is supportive, feedlots that have elected to hold out for more money could be able to fight for an additional $1.00 to $2.00 more. October live cattle closed $1.92 higher at $184.50, December live cattle closed $1.97 higher at $186.97 and February live cattle closed $1.92 higher at $191.25.
Wednesday's slaughter is estimated at 126,000 head, 1,000 head more than a week ago and 2,000 head more than a year ago.
Boxed beef prices closed lower: choice down $0.78 ($300.28) and select down $0.85 ($275.30) with a movement of 146 loads (82.78 loads of choice, 29.84 loads of select, 8.38 loads of trim and 25.02 loads of ground beef).
THURSDAY'S CATTLE CALL: Steady to $2.00 higher. Packers were able to get 94,000 head bought last week in the cash market, but with seasonal demand starting to pick up, they're going to need to secure ample supplies.
FEEDER CATTLE:
It was a glorious day for the feeder cattle complex as not only were the contracts able to close higher, but the spot November contract rounded out the day above its 100-day moving average, which has been a threshold of pressure as of late. Around the noon hour, it wasn't looking too promising for the cattle complex as both the live cattle and feeder cattle contracts were trading lower, but as the afternoon progressed and cash cattle trade started to be reported $1.00 higher in the South, the cattle market's demeanor changed. October feeders closed $2.22 higher at $250.17, November feeders closed $1.65 higher at $252.00 and January feeders closed $1.45 higher at $253.30. At Winter Livestock Auction in Riverton, Wyoming, compared to last week, yearling steers traded steady with instances of $5.00 to $10.00 higher, and yearling heifers traded mostly steady. Feeder steers with reputation quality or calves that were preconditioned traded with higher undertones, but the biggest advancements were made on the 400-pound steers, which saw instances of $20.00 and $35.00 price jumps. Feeder cattle supply over 600 pounds was 32%. The CME Feeder Cattle Index for Oct. 10: down $0.47, $249.79.
LEAN HOGS:
The cattle contracts closed higher but the lean hog complex didn't see the same support through Wednesday's end as they did. The cash market lent a little support as its weighted average price did close higher, but it only moved slightly over 3,000 head Wednesday afternoon, which isn't enough to make a real difference in the market's overall tone. Pork cutout values closed lower but only mildly so, which again just left trader in a position where they didn't receive enough fundamental support to justify scrapping for higher prices. December lean hogs closed $1.45 lower at $69.97, February lean hogs closed $1.02 lower at $74.67 and April lean hogs closed $0.82 lower at $81.00. Pork cutouts totaled 332.59 loads with 288.96 loads of pork cuts and 43.63 loads of trim. Pork cutout values: down $0.68, $92.39. Wednesday's slaughter is estimated at 485,000 head, 4,000 head more than a week ago and 7,000 head less than a year ago. The CME Lean Hog Index for Oct. 9: down $0.20, $82.26.
THURSDAY'S HOG CALL: Lower. Given that packers didn't show much interest in Wednesday's market, it could be that their mostly done buying for the week.
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