GENERAL COMMENTS:
It was a mixed day for the livestock complex as the lean hog market rallied throughout the day, but the cattle complex traded mixed. Traders could be leery of overly supporting the cattle contracts ahead of seeing what Friday's Cattle on Feed report unveils. December corn is down 2 1/2 cents per bushel and December soybean meal is up $0.90. The Dow Jones Industrial Average is up 192.48 points.
LIVE CATTLE:
Given that while the rest of the livestock complex was trading higher earlier in the day that the live cattle contracts were taking more a reserved and cautious approach to the week's start, it wasn't surprising to see the live cattle contracts round out the day with the same doggish tones that they carried throughout all of Monday's trade. October live cattle closed $0.42 lower at $177.22, December live cattle closed $0.15 lower at $178.35 and February live cattle closed $0.12 lower at $179.47. The market's resistance around its 40-day moving average is a threshold in which traders are going to need ample fundamental support backing them before they attempt to take on that barrier. New showlists appear to be mixed, higher in Texas, but lower in Kansas and Nebraska/Colorado. Monday's slaughter is estimated at 121,000 head -- 7,000 head more than a week ago and 1,000 head less than a year ago.
Last week Southern live cattle traded at mostly $181 which is mostly steady with the previous week's weighted average, and Northern dressed cattle traded at mostly $288 which is also steady with the previous week's weighted average. Last week's negotiated cash cattle trade totaled 61,496 head. Of that 83% (51,181 head) were committed to the nearby delivery, while the remaining 17% (10,315 head) were committed to the deferred delivery.
Boxed beef prices closed lower: choice down $0.34 ($304.57) and select down $2.03 ($292.14) with a movement of 134 loads (82.30 loads of choice, 13.93 loads of select, 5.09 loads of trim and 32.99 loads of ground beef).
TUESDAY'S CATTLE CALL: Steady. Given that packers weren't able to buy many cattle for the deferred delivery option last week likely means that they'll need to buy more cattle this week -- which could help feedlot manger's keep prices at least steady.
FEEDER CATTLE:
The feeder cattle complex rounded out the day mixed as some of the nearby contracts grew leery of closing higher ahead of the day's end. More than anything, it seemed as though the market's resistance around its 40-day moving average was too much of a hurdle for traders to jump this early in the week -- especially without the support of the live cattle complex as it closed lower. September feeders closed $0.60 lower at $241.30, October feeders closed $0.12 lower at $239.00 and November feeders closed $0.37 higher at $235.57. At Oklahoma National Stockyards in Oklahoma City, Oklahoma, compared to last week and at their mid-session point, compared to last steers and heifers were trading $3.00 to $8.00 higher which was commendable given that much of state is battling hot temperatures and dry conditions. Feeder cattle supply over 600 pounds was 61%. The CME feeder cattle index 9/13/2024: down $0.64, $242.68.
LEAN HOGS:
Following last week's lower end, the lean hog complex was able to rally through Monday's market as the contracts backed away from resistance levels last week. October lean hogs closed $1.47 higher at $79.92, December lean hogs closed $0.87 higher at $72.17 and February lean hogs closed $0.70 higher at $75.67. It was helpful that both pork cutout values and cash prices saw a little uptick throughout the day which helped guide traders as they were well supported fundamentally. With consumer demand being slightly disappointing last week, traders will be actively watching pork cutout values again this week. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $0.96 with a weighted average price of $76.96 on 3,684 head. Pork cutouts totaled 312.41 loads with 286.40 loads of pork cuts and 26.02 loads of trim. Pork cutout values: up $0.32, $94.22. Monday's slaughter is estimated at 486,000 head -- steady with a week ago and 1,000 head less than a year ago. The CME lean hog index 9/12/2024: down $0.48, $84.87.
TUESDAY'S HOG CALL: Steady to somewhat higher. Given that pork cutout values were up Monday, and that the futures complex was supportive, packers will likely support Tuesday's cash complex.
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