GENERAL COMMENTS:
What a day it's already been for the livestock contracts and it's not even noon! Wednesday's Cattle Inventory report continues to be the cattle market's biggest focus and the report will likely influence the market as it's expected that data will show fewer beef cows and the continuation of liquidation. March corn is up 5 1/4 cents per bushel and March soybean meal is up $6. The Dow Jones Industrial Average is up 52.30 points.
LIVE CATTLE:
The live cattle complex is the most cautious livestock market heading into Tuesday's noon hour. All the contracts are trading higher except April and June 2024 contracts, but the rest are only trading mildly higher. Traders have largely accepted that Wednesday's Cattle Inventory report will likely be supportive long-term for the market, but given that it's a big-hitting report, there is still some hesitancy throughout the marketplace. February live cattle are up $0.12 at $177.50, April live cattle are down $0.20 at $181.02 and June live cattle are steady at $178.47. No cash cattle trade has been reported and trade is likely delayed until late Wednesday or Thursday.
Boxed beef prices are mixed: Choice down $0.96 ($298.46) and select up $0.38 ($289.20) with a movement of 70 loads (37.37 loads of choice, 20.53 loads of select, zero loads of trim and 12.14 loads of ground beef).
FEEDER CATTLE:
Even though corn prices are $0.04 to $0.05 higher this morning, feeders are living up to the old saying, "feeders are the leaders," as feeder cattle contracts are trading anywhere from $1 to $2.15 higher. The market grew cold ahead of Monday's close and both the live cattle and feeder cattle contracts closed lower which was likely a knee-jerk reaction from traders as they are aware Wednesday's Cattle Inventory report could be a market influencer.
It's also likely that traders were pleased to see continued feeder cattle demand in sale barns as Monday's CME feeder cattle index closed $2.09 higher at $234.15. March feeders are up $2.07 at $240.70, April feeders are up $1.72 at $246.32 and May feeders are up $1.37 at $251.42.
LEAN HOGS:
The lean hog complex is taking a more cautious approach to Monday's start as contracts are still trading mostly higher even though a few of the nearbys are trading lower. The cash hog market is about as disappointing as it gets -- only 35 head of hogs were reported as sold in the cash market Monday morning. Traders are going to need to see follow-through demand in order for them to comfortability continue to support the contracts. Demand both here domestically and internationally will be crucial in the months ahead. February lean hogs are down $0.42 at $74.47, April lean hogs are down $0.05 at $83.20 and June lean hogs are up $0.02 at $96.02.
The projected CME Lean Hog Index for 1/26/2024 is up $0.68 at $70.58, and the actual index for 1/25/2024 is up $0.23 at $69.90. Hog prices are unavailable on the Daily Direct Morning Hog Report due to confidentiality. However, we can see that 35 head have traded (yes, I reported that correctly, only 35 head have traded) and the five-day rolling average now sits at $50.49. Pork cutouts total 180.42 loads with 150.77 loads of pork cuts and 29.65 loads of trim. Pork cutout values: down $0.02, $89.49.
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