GENERAL COMMENTS:
Feeder cattle futures have once again become the leader of the livestock and cattle market Wednesday. This time, the feeder cattle complex is leading all markets lower with traders squaring positions and pulling back from previous gains. Nearby futures are most pressured with losses at or near $2 per cwt, which is adding to weakness in early 2024 live cattle contracts and lean hog trade. There is very little new fundamental market direction available to traders, although the focus on meat values and cash price direction continues to be a limiting factor in additional buyer support willing to actively step into the complex.
Technically, the entire livestock market remains oversold, but generally weak due to recent market liquidation. The potential for long-term growth remains strong, but emotional pressure across both cattle and hog futures during December is likely to limit aggressive buyer interest.
March corn is down 4 1/4 at $4.81 and January soybean meal is down $5.60 at $404.7. The Dow Jones Industrial Average is down 5.76 at 36,572.18.
LIVE CATTLE:
Live cattle futures are shifting lower with the most pressure developing in early 2024 contract months. The firm pullback in feeder cattle futures prices, and concern that cash values may not see as significant support as hoped early in the week, is starting to limit overall buyer support. Following firm gains in nearby live cattle trade each of the past three trading sessions, the market has been ripe for a narrow market correct due to trades focusing on position squaring activity and adjusting positions following moving price levels above long-term support levels.
Cash cattle activity remains generally quiet with bids undeveloped and asking prices generally not well established in most areas. A very few cattle were sold Tuesday in the North at $168 per cwt which is well below last week's level. This is far too small of numbers to fully test the overall market direction or trend, given the volatility and emotion currently in the market. Some additional interest may be developing through the rest of the day, but it very well could be Thursday or Friday before active trade is seen.
December live cattle are $0.68 lower at $167.025, February live cattle are $1.33 lower at $167.275, April live cattle are $1.43 lower at $170.975.
Boxed beef prices are mixed: choice down $0.40 ($292.38) and select up $0.18 ($258.84) with a movement of 88.56 loads (53.23 loads of choice, 17.33 loads of select, 11.58 loads of trim and 6.42 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures have led the market lower Wednesday. Following strong gains each of the last three trading sessions and distanced prices from long-term support levels, traders continue to focus on position squaring activities during morning trade. Although the moves lower will do nothing to change the market technical factors, the lack of follow-through buyer momentum in not only the feeder cattle complex, but all cattle trade is likely to remain generally discouraging, given how much pressure the market has been over the past several weeks.
January feeders are $2.30 lower at $216.95, March feeders are $2.28 lower at $217.325 and April feeders are $1.85 lower at $221.50.
LEAN HOGS:
Lean hog futures are holding light to moderate losses due to limited morning trade as traders have backed away from buyer support seen Tuesday in the February and April contracts. The overall lack of new market information when it comes to cash hog direction or pork values is likely to limit buyer support in most if not all lean hog futures and could keep prices bouncing higher and lower in a moderate but sideways trading range.
December lean hogs are $0.10 lower at $67.725, February lean hogs are $0.58 lower at $67.675 and April lean hogs are $0.33 lower at $75.15. Hog Prices are lower on the Daily Direct Morning Hog report, down $0.11 with a weighted average of $49.79, ranging from $43.00 to $50.00 on 3,877 head with a five-day rolling average of $50.94. Pork Cutouts totaled 196.77 loads with 174.48 loads of pork cuts and 22.29 loads of trim. Pork cutout values are down $1.98 at $84.91.
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