Tuesday Closing Livestock Market Update - Traders Worry the Complex is Overbought Which Sent the Contracts Lower

GENERAL COMMENTS:

It was a quiet day for the livestock complex as the board struggled as traders worried about the markets being overbought, which consequently led to all three of the markets rounding out the day lower. Asking prices are noted in the South at $189 to $190 but remain unestablished still in the North. December corn is down 7 cents per bushel and December soybean meal is down $3.50. The Dow Jones Industrial Average is down 324.80 points.

LIVE CATTLE:

It was a lackluster day for the live cattle complex, though boxed beef prices closed higher. Traders were more concerned with the market's technical position than they were with assessing how fundamental support was encouraging. We knew that at some point traders were likely going to liquidate some of their positions from the market as technically speaking the market is overbought. This is likely the main reason why we're currently seeing the downtrend in cattle even though all fundamental indicators remain supportive. The next real question that the market must answer is -- how much lower does the market become before traders feel comfortable with their positions? October live cattle closed $1.52 lower at $186.72, December live cattle closed $1.40 lower at $186.52 and February live cattle closed $1.30 lower at $187.40. No cash cattle trade developed throughout the day but asking prices are noted at $189 to $190 in the South but are still unestablished in the North. 

Tuesday's slaughter is estimated at 125,000 head -- 1,000 head more than a week ago and 2,000 head less than a year ago.

Boxed beef prices are higher: choice up $3.51 ($316.83) and select up $2.99 ($292.09) with a movement of 136 loads (82.06 loads of choice, 27.65 loads of select, 6.14 loads of trim and 19.76 loads of ground beef).

WEDNEDSAY'S CATTLE CALL: Steady. Given that packers were able to buy some cattle with time last week likely means that prices will be steady this week with the reduction in throughput.

FEEDER CATTLE:

The feeder cattle complex endured a mixed day as the market's technical and fundamental indicators moved in opposite directions. Throughout the day the board struggled considerably as traders wanted the live cattle contracts to trade lower and react exaggeratively. Meanwhile, feeder cattle demand in the countryside continues to be exceptional. More than anything, today's weakness throughout the board for both the live cattle and feeder cattle contracts seem to be a technical reset as traders know the market is somewhat technically overbought and are reacting upon that realization. October feeders closed $2.60 lower at $246.52, November feeders closed $3.10 lower at $246.47 and January feeders closed $3.37 lower at $244.22. At Joplin Regional Stockyards in Carthage, Missouri compared to last week, feeder steer sunder 525 pounds sold $2.00 to $10.00 higher and heavier weights sold steady to $3.00 lower. Feeder heifers sold anywhere from $5.00 lower to $6.00 higher. Feeder cattle supply over 600 pounds was 64%. The CME feeder cattle index 10/14/2024: down $0.72, $249.89.

LEAN HOGS:

The lean hog complex drifted lower throughout the day as the market felt the same technical pressure that the cattle complex also endured, but then was disappointed with the day's lower close in pork cutout values. December lean hogs closed $0.57 lower at $75.22, February lean hogs closed $0.52 lower at $79.30 and April lean hogs closed $0.40 lower at $83.80. Unfortunately, most of the cuts on the afternoon cutout report showed weaker closes which isn't a good sign of consumer demand. It's likely that the complex could pressure again on Wednesday as traders are desperately going to need fundamental reassurance and currently the market isn't producing much fundamental confidence. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $2.33 with a weighted average price of $76.80 on 4,410 head. Pork cutouts totaled 416.39 loads with 335.62 loads of pork cuts and 80.77 loads of trim. Pork cutout values: down $0.57, $94.40. Tuesday's slaughter is estimated at 487,000 head -- 3,000 head more than a week ago and 6,000 head more than a year ago. The CME lean hog index 10/11/2024: down $0.13, $84.16.

WEDNEDAY'S HOG CALL: Steady. It's likely that packers will need to buy moderately again in Wednesday's market as they haven't purchased many hogs this week.

Tuesday Midday Livestock Market Summary - Technical Pressure Sends Complex Lower

GENERAL COMMENTS:

The livestock complex is enduring some pressure as the market nears Tuesday's noon hour. More than anything, the market seems to be liquidating from a technical sense as traders believe the complex is somewhat overbought. December corn is down 5 1/2 cents per bushel and December soybean meal is down $3.30. The Dow Jones Industrial Average is down 68.30 points.

LIVE CATTLE:

Traders seem to think Tuesday needs to be a downward trending day as the live cattle market is trading more than $1.00 lower in all contracts. One could point to the market's stronger boxed beef prices and say market fundamentals should be strong enough to support steady price; but given that the futures complex is technically overbought, we knew some trader liquidation was likely to come regardless of market fundamentals. October live cattle are down $1.55 at $186.70, December live cattle are down $1.62 at $186.30, and February live cattle are down $1.50 at $187.17. Asking prices are noted at $189 to $190 in the South but remain unestablished still in the North. No cash cattle trade is expected to develop ahead of Wednesday at the absolute earliest.

Boxed beef prices are higher: choice up $3.04 ($316.36) and select up $2.68 ($291.78) with a movement of 73 loads (38.78 loads of choice, 16.87 loads of select, 6.14 loads of trim and 11.46 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is also feeling some significant technical pressure as the market is currently trading anywhere from $2.00 to $3.00 lower. This obviously pushes the spot November feeder cattle contract back below its 100-day moving average. Unless the live cattle market changes its tune and direction, It's likely feeders will continue to trade in this dreary manner through the day's end. October feeders are down $2.12 at $247.00, November feeders are down $2.97 at $246.60, and January feeders are down $2.87 at $244.72.

LEAN HOGS:

Earlier Tuesday the lean hog complex was trading higher but as the noon hour nears, the lean hog complex is seeming to absorb some of the same pressure the cattle contracts are enduring. December lean hogs are down $0.12 at $75.67, February lean hogs are steady at $79.82, and April lean hogs are down $0.02 at $84.17. Also not helping matters is the fact that morning cutout values are slightly lower and again cash prices aren't visible because not enough hogs have traded.

The projected CME Lean Hog Index for 10/14/2024 is down $0.08 at $84.08, and the actual index for 10/11/2024 is down $0.13 at $84.16. Hog prices are unavailable on the Daily Direct Morning Hog Report because of confidentiality. However, we can see that just 1,485 head have traded and that the market's five-day rolling average now sits at $75.52. Pork cutouts total 250.99 loads with 190.08 loads of pork cuts and 60.91 loads of trim. Pork cutout values: down $0.08, $94.89.

Tuesday Morning Livestock Market Update - Traders Uncertain of Further Strength

GENERAL COMMENTS:

Cattle futures were in limbo Monday as traders spent the day assessing the market's potential this week. The weakness of grain futures provided some support as feed prices are expected to remain reasonable. This may remove some urgency to move cattle quickly this week, allowing feedlots to hold for no less than steady cash and hopefully higher prices as demand for beef seems to be improving. Boxed beef was higher Monday with choice up $2.10 and select up $0.38. The packers have been holding back on slaughter to improve margins, but higher beef demand needs to be satisfied. Lower feed prices and tighter supplies of cattle leave feedlots with better leverage. Higher cattle weights are not a problem in the current market environment.

Hog futures took a hit Monday. The October contract ceased trading with traders seeing no need to close the gap between the expiring October and the December contract. December is the lead month and was hit the hardest, nearly eliminating the gains of the previous two days. The price action is concerning as the momentum may be running out of steam. Cash was slightly higher on the National Dairy Direct Afternoon Hog report with a gain of $0.13. Cutouts were higher but nothing to write home about posting a gain of $0.50. The market needs to see consistent demand to maintain the uptrend. Traders are concerned that consistency may not unfold. Packers are expected to be more aggressive in the cash market Tuesday as they will need to increase purchases to maintain slaughter.

	BULL SIDE		BEAR SIDE
1)	The strength of boxed beef indicates good demand and that good demand will need to be satisfied. The packers may need to pay more for cattle to meet that demand.	1)	The packers may hold the line on cash this week as they feel feedlots need to sell cattle they have held back the past weeks before gaining even more weight.
2)	The feedlots will be looking for higher cash this week as packers do not have many cattle purchased ahead and demand is good.	2)	Cattle futures are overbought and may have a price correction if there is any negative news that might impact the market.
3)	Hog slaughter remains strong, continuing to keep supplies current. This should continue to support prices.	3)	Hog futures will need to find buying interest Tuesday or there could be further liquidation as the market corrects from being overbought.
4)	The packers did not purchase many hogs on Monday and should step up more aggressively Tuesday as they want to purchase supplies earlier in the week.	4)	The lack of consistency in cash and cutouts may leave traders cautious over upside potential, triggering some profit-taking.

Monday Midday Livestock Market Summary - Mixed Tones Summarize Complex

GENERAL COMMENTS:

The livestock complex is trading mixed into Monday's noon hour as the cattle contracts are pushing slightly higher while the hog complex dips lower. It will be imperative that demand is strong this week as traders need fundamental reassurance in all of the markets. December corn is down 5 1/4 cents per bushel and December soybean meal is up $2.70. The Dow Jones Industrial Average is up 194.18 points.

LIVE CATTLE:

With the continued support of stronger boxed beef prices, the live cattle complex is trading mostly higher into Monday's noon hour. Last week the market's fundamentals were extremely supportive as, not only were boxed beef prices higher throughout the majority of the week, but the cash cattle market traded steady to $1.00 higher too. Once again, this week traders will desperately need the market's fundamentals to continue to trade in a supportive manner if the board is going to maintain its position at these higher price points. October live cattle are down $0.10 at $188.50, December live cattle are up $0.62 at $188.20, and February live cattle are up $0.67 at $188.87. New showlists appear to be mixed, higher in Nebraska and Colorado, but lower in Kansas and Texas.

Last week Southern live cattle traded at mostly $187, which is $1.00 higher than the previous week's weighted average, and Northern dressed cattle traded at mostly $296, which is fully steady with the previous week's weighted average. Last week's negotiated cash cattle trade totaled 92,611 head. Of that 80% (74,479 head) were committed to the nearby delivery while the remaining 20% (18,132 head) were committed for the deferred delivery.

Boxed beef prices are higher: choice up $1.59 ($312.81) and select up $1.73 ($290.45) with a movement of 32 loads (19.23 loads of choice, 5.99 loads of select, zero loads of trim and 7.22 loads of ground beef).

FEEDER CATTLE:

Upon seeing the nearby corn contracts trading $0.05 to $0.07 cheaper and the live cattle market rallying yet again, the feeder cattle complex is trading higher into Monday's noon hour as well. It's interesting to note that the contracts currently with the biggest gains for the day are the March and April 2025 contracts, which could be indicative that traders are noting supplies are going to be incredibly thin during that time. October feeders are down $0.10 at $249.65, November feeders are up $0.70 at $250.50, and January feeders are up $0.95 at $248.20.

LEAN HOGS:

Even though midday pork cutout values are higher, the lean hog complex is trading mostly lower as traders are concerned about domestic consumer support following last week's weaker demand. December lean hogs are down $1.82 at $75.82, February lean hogs are down $1.35 at $79.80, and April lean hogs are down $0.92 at $84.25. Unless traders see better consumer demand this week, the market could potentially trade lower as it's currently at its highest price point in the last four months.

The projected CME Lean Hog Index for 10/11/2024 is down $0.13 at $84.16, and the actual index for 10/10/2024 is down $0.18 at $84.29. Hog prices are unavailable on the Daily Direct Morning Hog Report because of confidentiality. However, we can see only 229 head have traded and the market's five-day rolling average now sits at $75.52. Pork cutouts total 149.91 loads with 125.08 loads of pork cuts and 24.38 loads of trim. Pork cutout values: up $1.88, $96.35.

Monday Morning Livestock Market Update - Choppy Trading Activity Expected

GENERAL COMMENTS:

Hopes for higher cash cattle trade on Friday did not materialize with prices remaining at Thursday's levels. Southern cattle traded $1.00 higher for the week with Northern dressed cattle at steady money. Futures had it already factored in, leaving live cattle futures drifting lower. Feeder cattle futures closed higher in deferred contracts, likely as a reaction to lower grain prices and expected continued lower grain prices based on the WASDE report. The WASDE report was supportive of beef prices for the rest of this year and next year. These are just estimates and will change from month to month based on the strength or weakness of prices and did not have much influence on Friday's trading activity. Boxed beef prices were mixed with choice up $1.27 and select down $2.01. The Commitments of Traders report showed funds added 10,076 long futures in live cattle, increasing their net-long position to 77,964 contracts. They added 1,646 futures positions in feeder cattle, bringing their net-long position to 6,449 contracts.

Hog futures continued their strength making new highs and closing at the highest level since May on Friday. The National Direct Afternoon Hog report only showed the average price of $74.34 and did not report a change from the previous day. Pork cutouts declined $0.40 from Thursday. The WASDE report was mixed for hog prices and production but none of this mattered Friday as traders remain bullish on the market. The recent price correction relieved some of the overbought status of futures, giving traders confidence to add to their long positions. Monday is the last trading day for the October contract. The Commitments of Traders report showed the funds increasing their long positions by 14,429 contracts and a net-long position of 78,270 contracts. This is 20,000 contracts shy of the record set in September 2023.

	BULL SIDE		BEAR SIDE
1)	Cattle futures remain supported by tight cattle supplies and good demand. Demand is expected to remain strong through the end of the year.	1)	The cattle market is technically overbought and may be due for a price correction.
2)	Feedlots will try to hold for steady to higher cash this week as the packers likely have not purchased many cattle for deferred delivery.	2)	The feedlots have been holding cattle for higher prices and may need to move them more aggressively as they have been gaining weight and costing more money to maintain.
3)	Traders are optimistic about hog prices and continue to add positions for the long term. The supply of hogs may not be as much as estimated in the latest report.	3)	Cash hogs and pork cutouts have not been trending higher, which may limit the upside price potential of futures.
4)	The October hog contract goes off the board Monday with December taking over as the front month. It is carrying a discount that may be reduced.	4)	The nearing of contract highs and the substantially long position of the fund traders could trigger profit-taking in hog futures on any bearish news.

Friday Closing Livestock Market Update - Traders Leave the Complex Mixed Ahead of the Weekend

GENERAL COMMENTS:

Friday left the livestock complex with a mixed close as the live cattle market closed lower, feeders closed mostly higher, and the lean hog complex rallied throughout all of Friday's trade. Besides a few more sales in Western Nebraska at $188, but cash cattle market was quiet throughout most of the day. December corn is down 2 3/4 cents per bushel and December soybean meal is down $1.00. The Dow Jones Industrial Average is up 429.32 points.

From Friday-to-Friday livestock futures scored the following changes: October live cattle up $1.60, December live cattle up $0.58; October feeder cattle up $0.13, November feeder cattle up $0.53; October lean hogs up $0.05, December lean hogs up $1.50; December corn down $0.09, March corn down $0.09.

LIVE CATTLE:

The live cattle complex may have closed slightly lower Friday afternoon but that wasn't because of a lack of fundamental support. Rather instead, after supporting the live cattle contracts through the vast majority of the week and upon seeing the cash cattle market trade steady/$1.00 higher on Thursday, traders checked out of the market before the day ended. October live cattle closed $0.57 lower at $188.60, December live cattle closed $0.70 lower at $187.57 and February live cattle closed $0.67 lower at $188.20. There were a few more cash cattle sales reported in Western Nebraska at $188, but other than a few clean-up deals here and there the market was mostly quiet throughout the day. Throughout the week Southern live cattle traded at $186 to mostly $187 which is steady to $1.00 higher than last week's weighted average. Northern dressed cattle traded at mostly $296 which is also steady with last week's weighted average. 

Friday's slaughter is estimated at 106,000 head -- 2,000 head less than a week ago and 4,000 head less than a year ago. Saturday's slaughter is projected to be around 6,000 head. The week's total slaughter is estimated at 586,000 head -- 25,000 head less than a week ago and 30,000 head less than a year ago.

Friday's WASDE report was supportive to both the beef and cattle markets of 2024. 2024 beef production was raised by 205 million pounds to total 27,000,000 pounds for the year as beef production for the third and fourth quarters are expected to be greater than last month's projection and carcass weights remain at record levels. Beef production for 2025 was also increased -- by 300 million pounds -- as production in the first half of the year is expected to be greater than originally assumed. It was exciting to see quarterly steer price projections increased from last month's report as steer prices in the fourth quarter of 2024 are expected to average $186 (up $3.00 from last month), first quarter steer prices in 2025 are expected to average $187 (up $1.00 from last month) and second quarter steer prices in 2024 are expected to average $186 (which is steady with last month's projection). 2024 beef imports were increased by 55 million pounds as supplies continue to come into the US aggressively from Oceania and South America, but beef exports for 2024 were also increased by 5 million pounds.

Boxed beef prices closed mixed: choice up $1.27 ($311.22) and select down $2.01 ($288.72) with a movement of 94 loads (37.20 loads of choice, 28.87 loads of select, 14.62 loads of trim and 13.78 loads of ground beef).

MONDAY'S CATTLE CALL: Steady. Before any predictions about next week's cash market can be confidently made, we need to see exactly how many cattle were purchased this week and for what delivery options they were committed to. But given that packers drastically cut processing speeds this past week to lessen their dependence on the cash market, feedlot managers are going to be challenged next week in trying to continue to advance the market.

FEEDER CATTLE:

Even though the live cattle complex closed lower, the feeder cattle market was able to maintain most of its higher position although some of the nearby contracts closed mildly lower. But between the fed cash cattle market's stronger trade, to the tremendous buyer demand in the countryside and the continue support of traders in the futures complex -- this week's market could be described as another winning week for cattlemen and for the cattle complex as a whole. October feeder closed $0.52 lower at $249.75, November feeders closed $0.15 lower at $249.80 and January feeders closed $0.05 higher at $247.25. The Oklahoma Weekly Cattle Auction Summary shared that throughout the entire state and when compared to last week, feeder steers over 800 pounds sold $4.00 to $8.00 higher, and feeder steers under 800 pounds sold $2.00 to $5.00 lower. Steer vales traded $3.00 to $4.00 higher. Feeder heifers traded $3.00 to $5.00 higher and heifer calves sold steady to $4.00 lower. Slaughter cows sold $1.00 lower and slaughter bulls sold $1.00 higher. Feeder cattle supply over 600 pounds was 75%. The CME feeder cattle index 10/10/2024: up $0.53, $250.05.

LEAN HOGS:

The lean hog complex yet again managed to round out the day higher as traders continue to thrive on the supportive nature of Thursday's export report. December lean hogs closed $0.70 higher at $77.65, February lean hogs closed $0.75 higher at $81.15 and April lean hogs closed $0.55 higher at $85.17. Afternoon pork cutout values closed lower yet again but today the biggest limiting factor to the cutout values' ability to close higher was the loin's $3.99 decline. Hog prices averaged $74.34 on the Daily Direct Afternoon Hog Report on 1,754 head. Pork cutouts totaled 276.94 loads with 239.37 loads of pork cuts and 37.57 loads of trim. Pork cutout values: down $0.40, $94.47. Friday's slaughter is estimated at 484,000 head -- 4,000 head more than a week ago and 2,000 head more than a year ago. Saturday's slaughter is projected to be around 172,000 head. The CME lean hog index 10/09/2024: steady, $84.47.

Friday's WASDE report was mixed to both the hog and pork markets of 2024. Pork production for 2024 was decreased by 105 million pounds as recently slaughter speeds have been reduced and carcass weights are lighter. Quarterly price projections were favorable to the hog complex as hogs in the fourth quarter of 2024 are now expected to average $55 (up $1.00 from last month), hog prices in the first quarter of 2025 are expected to average $55 (up $1.00 from last month) and hog prices in the second quarter of 2025 are expected to average $61 (up $1.00 from last month). Pork imports for 2024 are unchanged, but pork exports for 2024 fell by 30 million pounds.

MONDAY'S HOG CALL: Lower. It's not very often that packers show much interest in the cash market on Mondays as they like to get a feel for the week's domestic demand before bidding on hogs.

Friday Midday Livestock Market Summary - Cattle Drift Lower While Hogs Tiptoe Past Resistance

GENERAL COMMENTS:

The livestock complex is trading mixed into Friday's noon hour as the cattle contracts drift lower while the hog complex continues to rally thanks to Thursday's strong export report. No new cash cattle sales have been reported and it looks like the bulk of this week's trade is done. December corn is down 1 3/4 cents per bushel and December soybean meal is down $2.00. The Dow Jones Industrial Average is up 279.92 points.

LIVE CATTLE:

Traders don't seem that interested in supporting the live cattle complex as Friday's noon hour nears. After advancing the complex earlier in the week and seeing that the bulk of the week's cash cattle business is done, traders simply seemed to check out of the market and uninterested in doing much with the market ahead of the weekend given that they were actively involved in the market earlier this week. October live cattle are down $0.27 at $188.90, December live cattle are down $0.42 at $187.85, and February live cattle are down $0.55 at $188.32. No new cash cattle sales have been reported and no bids have been renewed. Some clean-up trade could happen ahead of the day's close, but largely it's looking like packers are done buying for the week.

Friday's WASDE report was supportive to both the beef and cattle markets of 2024. 2024 beef production was raised by 205 million pounds to total 27,000,000 pounds for the year as beef production for the third and fourth quarters are expected to be greater than last month's projection and carcass weights remain at record levels. Beef production for 2025 was also increased -- by 300 million pounds -- as production in the first half of the year is expected to be greater than originally assumed. It was exciting to see quarterly steer price projections increased from last month's report as steer prices in the fourth quarter of 2024 are expected to average $186 (up $3.00 from last month), first quarter steer prices in 2025 are expected to average $187 (up $1.00 from last month) and second quarter steer prices in 2024 are expected to average $186 (which is steady with last month's projection). 2024 beef imports were increased by 55 million pounds as supplies continue to come into the US aggressively from Oceania and South America, but beef exports for 2024 were also increased by 5 million pounds.

Boxed beef prices are higher: choice up $1.10 ($311.05) and select up $0.98 ($291.71) with a movement of 51 loads (18.90 loads of choice, 7.80 loads of select, 13.41 loads of trim and 10.86 loads of ground beef).

FEEDER CATTLE:

The nearby feeder cattle contracts are following in line with the live cattle contracts, but the deferred months have kept their upward trajectory regardless of what the live cattle complex is doing. October feeders are down $0.40 at $249.87, November feeders are down $0.07 at $249.87, and January feeders are down $0.07 at $247.12. Currently, even with the spot November contract trading slightly lower, the market remains above its 100-day moving average which will be a critical threshold to monitor when checking prices at the day's close. If traders keep the market above that threshold, it signals technical strength and support; but if traders allow the market to retreat below that threshold, questions could arise as to how much more upside potential the market has in the near future.

LEAN HOGS:

Seeming to still be rallying on the strong export sales report from Thursday, the lean hog complex is inching above resistance as Friday's noon hour approaches. Thankfully, in terms of quarterly price projections, hog prices are expected to be higher than originally thought on last month's WASDE report which lends some supplemental support to the market. December lean hogs are up $0.67 at $77.62, February lean hogs are up $0.62 at $81.02, and April lean hogs are up $0.30 at $84.92. The projected CME Lean Hog Index for 10/10/2024 is down $0.18 at $84.29, and the actual index for 10/9/2024 is steady at $84.47. Hog prices are not available on the Daily Direct Morning Hog Report due to confidentiality. However, we can see only 349 head have traded Friday and the market's five-day rolling average now sits at $75.52. Pork cutouts total 168.20 loads with 146.09 loads of pork cuts and 22.11 loads of trim. Pork cutout values: up $0.50, $95.37.

Friday's WASDE report was mixed to both the hog and pork markets of 2024. 2024 pork production was decreased by 105 million pounds as recently slaughter speeds have been reduced and carcass weights are lighter. Quarterly price projections were favorable to the hog complex as hogs in the fourth quarter of 2024 are now expected to average $55 (up $1.00 from last month), hog prices in the first quarter of 2025 are expected to average $55 (up $1.00 from last month) and hog prices in the second quarter of 2025 are expected to average $61 (up $1.00 from last month). Pork imports for 2024 are unchanged, but pork exports for 2024 fell by 30 million pounds. 

Friday Morning Livestock Market Update - Traders Will Focus on Cash Trade

GENERAL COMMENTS:

Cattle futures turned higher after early losses. Cash cattle traded $1.00 higher in the South and steady in the North. The anticipation became a reality, leaving traders confident to buy into the market. Cash trade was not expected until Friday but business being done on Thursday provided support. This likely set the stage for further cash trade Friday. Boxed beef prices continue to provide support with choice up $1.77 and select up $2.10. It has been a good week for boxed beef which should continue to support the market. Packers have reduced slaughter, which naturally would increase boxed beef prices. They need to improve margins and that is the way to do it. Reducing slaughter may also back up cattle in the country so feedlots will need to sell the cattle to move them and not remain in the positions to hold. Weekly export sales were 39% below the previous week which may be a result of higher beef prices.

Hog futures found support Thursday, turning contracts higher to retain the uptrend. Traders did not have the result of cash prices on Thursday as those prices were not released based on packer confidentiality. Cutouts were lower with values down $0.33. Support stemmed from strong export sales of 50,600 metric tons (mt), up 17% from the previous week. International buyers are not stepping back and want pork. October hog futures will cease trading Monday and December will take over as the lead month, carrying a $7.00 discount that may be eliminated if demand remains positive. Saturday slaughter is estimated at 170,00 head.

	BULL SIDE		BEAR SIDE
1)	Steady to higher cash this week will leave traders confident to hold long positions and support the market.	1)	The higher beef prices may impact international demand keeping exports at lower levels. It will also keep imports at a higher level.
2)	October live cattle futures closed at the highest level since Oct. 12, 2023. There is a chart gap remaining from Oct. 3, 2023, about $1.50 higher that may be filled.	2)	Traders are anticipating higher cash cattle trade than what took place Thursday. If further gains do not develop, October futures may decline to move in line with cash.
3)	Fund traders continue to defend their long positions in hog futures. Lower cutouts and the uncertainty of cash Thursday did not put pressure on the market.	3)	Pork cutouts have not provided much support so far this week. The higher slaughter pace keeps sufficient pork on the market.
4)	Strong pork export sales provided support as international demand remained strong. This will keep the slaughter pace above the level of a year ago.	4)	The packers may have purchased sufficient hogs for the week leaving them unaggressive in the cash market Friday.

Thursday Closing Livestock Market Update - Southern Cattle Trade $1.00 Higher, Northern Cattle Trade Steady

GENERAL COMMENTS:

It was a strong day for the livestock complex as all three of the markets closed higher and the cash cattle market managed to trade $1.00 higher in the South and steady in the North. Some more trade could develop on Friday, but it's likely that the week's prices are set. December corn is down 2 1/2 cents per bushel and December soybean meal is down $5.10. The Dow Jones Industrial Average is down 57.88 points.

Thursday's export report shared that beef net sales of 13,700 mt for 2024 were down 39% from the previous week and 8% from the prior 4-week average. The three primary buyers were China (4,200 mt), Japan (3,500 mt) and South Korea (1,500 mt). Pork net sales of 50,600 mt for 2024 were up 17% from the previous week and 56% from the prior 4-week average. The three primary buyers were Mexico (27,200 mt), Japan (7,200 mt) and South Korea (3,900 mt).

LIVE CATTLE:

It was a supportive day for the live cattle complex as the market yet again closed higher thanks to the help of strong market fundamentals which came from higher boxed beef prices and the fed cash cattle market. Throughout the day Southern live cattle traded at $187 which is $1.00 higher than last week's weighted average and Northern dressed sales were marked at $296 which is steady with last week's weighted average. I was somewhat surprised to see Northern cattle trading steady as I believed that feedlot managers may hold out for better money. Then again, it's pretty hard to look at a bid of $296 and turn it down when you put historical prices for this time of year into perspective. October live cattle closed $0.97 higher at $189.17, December live cattle closed $1.05 higher at $188.27 and February live cattle closed $0.70 higher at $188.87. Some more trade could take place on Friday, but given that packers have cut throughput, it's likely that the week's volume will be fairly thin. 

Thursday's slaughter is estimated at 115,000 head -- 9,000 head less than a week ago and 6,000 head less than a year ago.

Boxed beef prices closed higher: choice up $1.77 ($309.95) and select up $2.10 ($290.73) with a movement of 108 loads (57.61 loads of choice, 30.28 loads of select, 7.11 loads of trim and 13.34 loads of ground beef).

FRIDAY'S CATTLE CALL: Steady with the week's trend. Given that prices have now been reported in both regions, it's likely that the week's average is set.

FEEDER CATTLE:

The feeder cattle complex was elated to see the live cattle contracts trading higher and then further supported by the fed cash cattle market's steady to $1.00 higher trade. Seeing ample support in the market, pushing the contracts higher was somewhat effortless for traders throughout Thursday's trade. October feeders closed $1.00 higher at $250.27, November feeders closed $1.27 higher at $249.95 and January feeders closed $1.32 higher at $247.20. It is also worth noting that again the spot November contract closed above its 100-day moving average, which continues to a threshold traders want to conquer but will need stable fundamental support in order to keep the market above that price point. At La Junta Livestock Commission in La Junta, Colorado compared to last week feeder steers sold $2.00 to $14.00 higher with instances sharply higher across all weight classes. Feeder heifers sold $2.00 to $14.00 higher as well. Feeder cattle supply over 600 pounds was 41%. The CME feeder cattle index 10/9/2024: up $0.04, $249.52.

LEAN HOGS:

The lean hog complex was also able to close higher as the market was grateful for the day's strong export sales report. Traders advanced the entire marketplace upon seeing such robust export demand, which also helped ease the disappointment in seeing this afternoon's cutout price drift slightly lower yet again. Today's afternoon carcass price was pulled lower because of the belly's $5.01 decline -- most of the other cuts either close only mildly lower or closed higher. December lean hogs closed $1.37 higher at $76.95, February lean hogs closed $0.95 higher at $80.40 and April lean hogs closed $0.65 higher at $84.62. Hog prices are unavailable on the Daily Direct Afternoon Hog Report due to confidentiality. However, we can see that only 1,752 head traded throughout the day which pushed the five-day rolling average to $76.11. Pork cutouts total 318.29 loads with 287.81 loads of pork cuts and 30.48 loads of trim. Pork cutout values: down $0.33, $94.87. Thursday's slaughter is estimated at 487,000 head -- 11,000 head more than a week ago and 4,000 head more than a year ago. The CME lean hog index 10/8/2024: up $0.25, $84.47.

FRIDAY'S HOG CALL: Lower. At this point its safe to say that packers have bought the vast majority of their cash needs for the week and won't likely be active in Friday's cash market.

Thursday Midday Livestock Market Summary - Traders Send Contracts Higher with Strong Export Demand

GENERAL COMMENTS:

The livestock complex is trading fully higher into Thursday's noon hour as traders have taken note of the day's strong export sales report and are thankful to see the continued demand. A few Northern sales have been reported at $296, and bids of $186 are currently being offered in the South but no live sales have been reported yet. December corn is down 2 1/2 cents per bushel and December soybean meal is down $4.60. The Dow Jones Industrial Average is down 23.34 points.

Thursday's export report shared that beef net sales of 13,700 mt for 2024 were down 39% from the previous week and 8% from the prior 4-week average. The three primary buyers were China (4,200 mt), Japan (3,500 mt) and South Korea (1,500 mt). Pork net sales of 50,600 mt for 2024 were up 17% from the previous week and 56% from the prior 4-week average. The three primary buyers were Mexico (27,200 mt), Japan (7,200 mt) and South Korea (3,900 mt).

LIVE CATTLE:

I'm somewhat surprised to see that some Northern cattle have already been sold for $296, which is fully steady with last week's weighted average. One would logically think that with boxed beef prices higher and the board trading in a supportive manner, feedlot managers would be inclined to wait to market their cattle until Friday in hopes of seeing prices advance another $1.00 to $2.00 higher. But at this point, only around 1,000 head of cattle have sold in the North which means that there's still a chance that prices could turn higher by Friday if the rest of the market holds out. Bids are currently being offered in the South at $186, which is $2.00 lower than feedlots' asking price of $188. October live cattle are up $0.52 at $188.67, December live cattle are up $0.77 at $188.00 and February live cattle are up $0.55 at $188.75.

Boxed beef prices are higher: choice up $1.44 ($309.62) and select up $1.80 ($290.43) with a movement of 71 loads (40.11 loads of choice, 23.83 loads of select, zero loads of trim and 6.59 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is back to trading higher and, low and behold, the spot November feeder cattle contract is even trading above its 100-day moving average again. So long as the live cattle contracts continue to trade in a stronger manner, it's likely that feeders will be able to keep their momentum through the day's end given that fundamental support from sales in the countryside remains strong for both calves and feeders. October feeders are up $0.45 at $249.72, November feeders are up $0.85 at $249.52 and January feeders are up $0.70 at $246.57.

LEAN HOGS:

Thursday's export report was a breath of fresh air for the hog complex as traders desperately needed to see some demand. Upon seeing export sales up sharply compared to a week ago, the lean hog complex is trading fully higher into Thursday's noon hour which puts the spot December contract nearing resistance again. December lean hogs are up $1.47 at $77.05, February lean hogs are up $1.00 at $80.45 and April lean hogs are up $0.50 at $84.47.

The projected lean hog index for 10/9/2024 is steady at $84.47, and the actual index for 10/8/2024 is up $0.25 at $84.47. Hog prices are unavailable on the Daily Direct Morning Hog Report due to confidentiality. However, we can see that only 1,752 head have traded, and that the market's five-day rolling average now sits at $75.52. Pork cutouts total 219.58 loads with 198.85 loads of pork cuts and 20.73 loads of trim. Pork cutout values: down $0.35, $94.85.

Thursday Morning Livestock Market Update - Futures May Show Further Weakness

GENERAL COMMENTS:

Traders did not see any cash cattle trade develop and felt the market already had an increase factored in. The October live cattle contract moved near the contract high with December and February setting new highs before falling back Wednesday. Traders decided to temper their buying ahead of seeing what cash would do this week. There is anticipation that cash cattle will trade higher this week, but higher cash is already factored in. Boxed beef prices indicated demand is improving with prices higher again Wednesday. Choice boxed beef increased by $1.34 with select up by $0.02. Based on the pattern of the past two weeks, it isn't likely cattle will trade today unless packers feel they need to get business done and pay more for the cattle. Feeder cattle prices continue to remain strong on good demand.

Hog futures made a price correction Wednesday with follow-through activity expected Thursday as the market corrects from being overbought. Packers have not been aggressive the past two days with the National Direct Afternoon Hog report showing a decline of $1.32. Hog trade has been rather light this week, which may require packers to be more aggressive to finish the week. Pork cutouts provided some support, posting a gain of $0.39. Hog weights crept higher again, keeping more pork available to the market.

	BULL SIDE		BEAR SIDE
1)	Boxed beef prices have been stronger this week, making a strong case for higher cash cattle trade.	1)	Cattle futures already have higher cash factored in. This may limit further upside potential for the rest of the week.
2)	Feeder cattle are in demand with strong prices continuing at auctions. The supply of feeder cattle remains tight.	2)	Cattle futures are overbought and steady or weaker cash could trigger long liquidation and a market correction.
3)	Pork demand has been strong, keeping the slaughter pace higher than a year ago even though hog weights are higher.	3)	The weekly average hog weights totaled 284.8 pounds, up 0.6 pound from the previous week. This is 2.9 pounds above a year ago.
4)	The price correction is healthy for a bullish market. Once the price has corrected, traders may increase their ownership of contracts for the long term.	4)	Liquidation may continue Thursday as the weakness on Wednesday and an overbought market may trigger further selling.

Wednesday Closing Livestock Market Update - Traders Ease Their Support of Contracts

GENERAL COMMENTS:

It was a disappointing day for the livestock complex as traders weren't as aggressive in their support of the market as all three of the markets closed lower. Still no cash cattle trade has developed, and the week's trade could be delayed again until Friday as feedlot managers aim to see prices advance again this week. December corn is up 1/4 cent per bushel and December soybean meal is down $1.80. The Dow Jones Industrial Average is up 431.63 points.

LIVE CATTLE:

The live cattle complex has seemed to run out of momentum and rounded out Wednesday's trade slightly lower across all the contracts. The real question that everyone is asking is: Is the market stalling to see what cash cattle prices do, or is the market topping? Determining the outcome of that question could easily be done with a coin as it's somewhat likely that if cash cattle prices trade stronger again this week traders could continue to press onward. However, if fundamental support weakens even the slightest bit, traders could elect to see the market's overbought nature as a reason to pull the plug and let prices venture lower again. So once again this week, not only will we be waiting to see how the cash cattle market fairs later this week, but also how traders react to the cash market's developments. October live cattle closed $0.27 lower at $188.20, December live cattle closed $0.65 lower at $187.22 and February live cattle closed $0.77 lower at $188.17. A single bid was offered throughout the day in Iowa at $187 but no cattle traded. Asking prices are noted in the South at $188 but remain unestablished still for the North. 

Wednesday's slaughter is estimated at 125,000 head -- 1,000 head more than a week ago and steady with a year ago.

Boxed beef prices closed higher: choice up $1.34 ($308.18) and select up $0.02 ($288.63) with a movement of 189 loads (138.06 loads of choice, 31.93 loads of select, 3.26 loads of trim and 16.10 loads of ground beef).

THURSDAY'S CATTLE CALL: $1.00 higher. I remain optimistic that feedlot managers are committed to advancing the market given that they hold the lion's share of the market's leverage and are in a position in which they can simply roll over this week's showlist if prices aren't what they desire.

FEEDER CATTLE:

The feeder cattle market endured a slightly more strenuous day than the live cattle market did as traders saw the live cattle market's lower trend as a reason to duck back below the market's 100-day moving average in the spot November contract. Even though demand remains incredibly strong in the countryside, traders seemed only concerned about how traders reacted throughout the day and didn't give much merit to buyer demand in the countryside unfortunately. October feeders closed $1.05 lower at $249.27, November feeders closed $1.62 lower at $248.67 and January feeders closed $1.57 lower at $245.87. At Winter Livestock Auction in Riverton, Wyoming compared to last week yearling steers traded steady with instances of $7.00 to $8.00 higher and yearling heifers traded mostly $5.00 to $8.00 higher with instances of $11.00 to $12.00 higher. Steers under 500 pounds sold $12.00 to $20.00 higher and steers over 500 pounds sold mostly $6.00 to $8.00 higher. Feeder cattle supply over 600 pounds was 43%. The CME feeder cattle index 10/8/2024: up $0.73, $249.48.

LEAN HOGS:

The lean hog complex closed lower as the market is somewhat concerned about what Friday's WASDE report is going to unveil in terms of consumer demand later this year and into 2025. Yes, afternoon cutout values closed slightly higher, but with demand being hit or miss this week, today's slight $0.39 jump wasn't enough to ease trader's concerns. December lean hogs closed $1.60 lower at $75.57, February lean hogs closed $1.32 lower at $79.45 and April lean hogs closed $1.10 lower at $83.97. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $1.32 with a weighted average price of $75.16 on 2,372 head. Pork cutouts totaled 308.37 loads with 267.59 loads of pork cuts and 40.79 loads of trim. Pork cutout values: up $0.39. Wednesday's slaughter is estimated at 486,000 head -- steady with a week ago and 3,000 head more than a year ago. The CME lean hog index 10/7/2024: down $0.04, $84.22.

THURSDAY'S HOG CALL: Lower. With pork cutout values being softer this week it's likely that packers could be essentially done buying already this week in the cash market.

Heavier carcass weights offset decline in production

Analysts forecasted a 4-5% decline in 2024’s beef production, but by mid-September, production was down only 1.1% from the previous year. This discrepancy is due to heavier carcass weights. Steer carcass weights averaged 930 lbs in August 2024, up 29 lbs from a year ago. Heifer carcass weights are up 20 lbs from the previous year. The increase in carcass weights is largely driven by a reduction in cattle numbers, incentivizing longer feeding periods to maintain feedlot inventories. Decreasing feed prices also encourage longer feeding periods as the value of gain exceeds the cost. Corn prices were under $4 per bushel in August, before rising by $0.29 per bushel during September. Hay prices have fluctuated but remained below 2023 levels for feeder quality hay. Northwest feedlots had access to ample, low-cost potato silage due to an oversupply of potatoes in 2023.

Producers are optimistic due to strong cattle market performance. Western producers have seen phenomenal fall sale prices, with some calves selling for over $3 per cwt. Despite increasing drought conditions in parts of the West, the availability of inexpensive and abundant hay has boosted confidence. Even with the expected seasonal price softening during the fall, producers remain positive.

Starting Nov. 5, all ear tags for cattle, including all dairy and sexually intact beef breeds over 18 months, must be electronically readable for interstate shipment. Cattle going directly to slaughter and those moving across state lines to graze pasture are exempt, and ear tags applied before this date are grandfathered in. The USDA aims to increase traceability for disease outbreaks, enabling quicker responses and supporting international buyer trust. However, some ranchers are concerned about data security and finding electronic tags could be cost-prohibitive for smaller operations in the long term (tags averaging $3 per head). Opponents also argue that for the system to be fully prepared for a foreign animal disease outbreak, approximately 70% of cattle would need to be traceable, whereas this new rule would only affect about 11-12% of cattle.

Profitability

Cattle feeders: Slightly profitable - Bearish 12-month outlook
Cow-calf producers: Profitable - Neutral 12-month outlook

The cost of acquiring cattle will pose significant challenges for cattle feeder profitability, and scarcity may lead to intensified competition, further driving up prices. However, lower feed prices, particularly corn, are a mitigating factor to high placement costs.

Historically high cattle prices and lower feed costs support long-term cow-calf profitability, but headwinds persist with steep replacement cattle costs, ongoing drought, and high interest rates.

Wednesday Midday Livestock Market Update - Traders Hit the Pause Button on Complex's Rally

GENERAL COMMENTS:

The livestock complex has stalled its upward trend as traders need a little more fundamental support than what they've currently seen in the sector. Still no cash cattle trade has developed and it's likely that trade will be delayed until Thursday or Friday. December corn is up 1/4 cent per bushel and December soybean meal is up $0.10. The Dow Jones Industrial Average is up 371.05 points.

LIVE CATTLE:

Traders are hitting the pause button on the live cattle market's rally as the complex trades slightly lower into Wednesday's noon hour. Yes, boxed beef prices are higher which is another positive fundamental point that feedlot managers will surely take note of, but traders are seeming hesitant to advance the contracts any more ahead of seeing what the cash market accomplishes this week. Asking prices of $188 are currently noted in the South, but still no asking prices have been noted for the North. It's very likely that the week's trade could be delayed until Friday as feedlot managers are going to push for higher prices again this week, but packers will be reluctant to pay up as they're trying to manage thin margins already as it is. So until the cash cattle market trades, monitoring boxed beef prices will be important, and hopefully traders can sit idle and not grow worrisome in their waiting. October live cattle are down $0.07 at $188.40, December live cattle are down $0.52 at $187.35 and February live cattle are down $0.67 at $188.25.

Boxed beef prices are higher: choice up $1.61 ($308.45) and select up $0.87 ($289.48) with a movement of 105 loads (79.29 loads of choice, 16.02 loads of select, zero loads of trim and 9.68 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is feeling some pressure as the market notes the live cattle complex's slight regression and is really needing the extra support today given that traders pushed the spot November contract above the market's 100-day moving average. At this point, traders aren't finding enough supplemental support to keep the November contract above that threshold, as all of the contracts are trading slightly lower into the noon hour. And even though buyer demand is incredibly strong in the countryside, unless the live cattle contracts turn higher, feeders will likely keep this lower tone through the day's end. October feeders are down $1.00 at $249.32, November feeders are down $1.65 at $248.65 and January feeders are down $1.52 at $245.92.

LEAN HOGS:

The lean hog complex is also trading lower as the market is up against resistance and isn't finding enough fundamental support to create higher trade. December lean hogs are down $1.77 at $75.40, February lean hogs are down $1.60 at $79.17 and April lean hogs are down $1.40 at $83.67. Friday's WASDE report will be especially interesting for the market as hopefully producers and traders alike will get a better sense of what demand and prices could be for the fourth quarter of 2024 and first quarter of 2025 with there being ample supplies of hogs currently on the market weighing 180 pounds or more.

The projected lean hog index for 10/8/2024 is up $0.25 at $84.47, and the actual index for 10/7/2024 is down $0.04 at $84.22. Hog prices on the Daily Direct Morning Hog Report average $75.52, ranging from $74.00 to $76.50 on 1,827 head and a five-day rolling average of $75.31. Pork cutouts total 189.58 loads with 161.08 loads of pork cuts and 28.50 loads of trim. Pork cutout values: up $0.82, $95.63.

Wednesday Morning Livestock Market Update - Cattle Futures May Have Higher Cash Factored In

GENERAL COMMENTS:

Boxed beef prices were mixed Tuesday with choice up $1.09 and select down $0.18. That was not enough to set a negative tone in the market as the recent strength indicates strong demand for beef. The packers may not slow the slaughter pace further as they need to supply beef to the market. Feedlots will hold out for higher prices this week as they know the packers did not purchase many for deferred delivery. Higher futures prices also provide confidence to feedlots that higher cash can be achieved. Cash trade is likely to be pushed to the end of the week Lower feed prices allow the feedlots to hold for higher prices and hold for the following week if necessary. Cattle numbers remain tight and will remain that way for some time.

December hogs pushed to a new high for the move Tuesday and closed above resistance and the highest close since May 15. The trend remains up and fund traders continue to buy into the market. It is uncertain whether futures will revisit the contract high of $79.50. Futures are only $2.40 away from reaching that level. The packers were not as aggressive as expected Tuesday and will need to step up and purchase more hogs as the week progresses. Their purchases so far this week have been limited. The National Direct Afternoon Hog report showed cash down $0.20. Pork cutout values were down $1.24. Pork demand has been good and will need to remain that way or the prices may see pressure, which could trigger the liquidation of futures.

	BULL SIDE		BEAR SIDE
1)	The feedlots are gaining confidence to hold for higher prices due to the strength of futures.	1)	Cattle futures are overbought and ripe for a price retracement. If cash cattle trade is steady this week, it could trigger profit-taking.
2)	Choice boxed beef prices have been higher so far this week, indicating consumer demand may be improving as the calendar moves toward the end of the year.	2)	The packers may try to reduce slaughter pace to limit the amount of cattle they need to purchase. The hope is to have feedlots let go of their cattle ready for the market rather than hold them.
3)	Hog futures remain in a strong uptrend as traders are not shy about supporting the market even when cash and cutouts show weakness.	3)	Hogs need to find more consistency in cash and cutouts to support futures and reach back to contract highs. Otherwise, futures could retrace as traders lighten positions.
4)	The packers need to purchase more hogs and may step up more aggressively Wednesday rather than wait until the end of the week.	4)	Hog futures are overbought and some liquidation may be seen ahead of the weekend if cash hog prices cannot move higher through the end of the week.

Tuesday Midday Livestock Market Summary - November Feeders Trading Above 100-Day Moving Average

GENERAL COMMENTS:

Thus far it's been another prosperous day for the livestock complex as all three markets are heading into Tuesday's noon hour higher. Asking prices are noted in the South at $188 but have not yet been established in the North. December corn is down 5 3/4 cents per bushel and December soybean meal is down $2.30. The Dow Jones Industrial Average is up 72.35 points.

LIVE CATTLE:

The live cattle complex is charging higher into Tuesday's noon hour as traders feel well supported by the higher note in choice cuts. Yes, select cuts may be down slightly, but the recent rally in choice cuts has been rather aggressive and could help lend enough support to the cash market for prices to trade steady/somewhat higher again this week. It's too early in the week for any cash cattle trade to have developed, but thankfully the fundamental support is encouraging traders as the market continues to grind higher. October live cattle are up $).72 at $188.20, December live cattle are up $0.60 at $187.62 and February live cattle are up $0.32 at $188.62. Asking prices are noted in the South at $188 but are still not established yet in the North. Trade will likely be delayed until Thursday or Friday as feedlot managers aim to advance the market again this week even if packers have cut throughput.

Boxed beef prices are mixed: choice up $1.09 ($307.02) and select down $0.18 ($289.15) with a movement of 67 loads (30.60 loads of choice, 18.85 loads of select, 5.89 loads of trim and 12.11 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is leading an impressive rally into Tuesday's noon hour which has propelled the spot November contract to trade above its 100-day moving average, which hasn't been done since early July. But as traders note the continued support of steady/higher boxed beef prices (especially in the choice cut) and again see traders willing to support the live cattle contracts -- traders seem committed to advancing the feeder cattle market while buyer demand in the countryside remains incredibly strong. It will be especially interesting to see if the spot November contract can maintain its position above the market's 100-day moving average through closing as that would signal strong technical support and lead to the obvious question of: How high do traders intend to move this market? October feeders are up $0.87 at $249.72, November feeders are up $0.65 at $249.80 and January feeders are up $0.72 at $246.90.

LEAN HOGS:

The lean hog complex is continuing to trade higher despite midday fundamentals not lending much support. December lean hogs are up $0.22 at $77.07, February lean hogs are up $0.02 at $80.62 and April lean hogs are down $0.12 at $84.75. Unless the afternoon's carcass price closes higher, it's likely that the futures market's rally could be stalemated come Wednesday as traders won't likely elect to move the market any higher without the support of strong market fundamentals.

The projected lean hog index for 10/7/2024 is down $0.04 at $84.22 and the actual index for 10/4/2024 is down $0.57 at $84.26. Hog prices are unavailable on the Daily Direct Morning Hog Report due to confidentiality issues. However, we can see that only 718 head have traded, and the week's five-day rolling average now sits at $74.02. Pork cutouts total 198.19 loads with 179.50 loads of pork cuts and 18.69 loads of trim. Pork cutout values: down $1.24, $94.81.

Tuesday Morning Livestock Market Update - Strong Demand Supports Complex

GENERAL COMMENTS:

Live cattle futures spent some time in negative territory but were able to close Monday positive for the day. Traders may be hesitant over the upside price potential for cash. The fact that packers did not purchase many head for deferred delivery provides confidence that higher prices may be obtained. Boxed beef prices surged with choice up $3.35 and select up $1.72. There have been back-to-back days of good boxed beef prices which has added to the support for higher cash prices. Futures contracts for next year continue to make higher highs and are nearly at a level of technical resistance. The current pasture and rangeland conditions are not very good, which may continue to curtail heifer retention and the growth of cattle numbers.

Hog futures were higher in most contracts Monday as traders saw strength in cash and cutouts. The National Direct Afternoon Hog report showed cash up $1.79. The packers have been starting each week aggressively, indicating demand is good and they want to purchase early to obtain needed supply for the week. Cash is expected to be higher Tuesday as the packers remain aggressive. Cutout values increased by $1.74. The good demand requires a strong slaughter pace, keeping hogs from backing up in the country. Weights are higher but supplies are current.

	BULL SIDE		BEAR SIDE
1)	The recent strength of boxed beef prices may indicate demand is improving. The improving demand will require slaughter to remain near the current level.	1)	Packers may try to reduce slaughter pace to limit the need to be aggressive with cattle purchases and limit what they need to pay for cattle.
2)	There is a strong demand for feeder cattle as supplies are tight and the price outlook for live cattle continues to look good.	2)	Cattle futures are overbought and a price retracement could take place if there is an indication of steady or weaker cash.
3)	The December hog contract closed above technical resistance with the later contracts near resistance. Futures are near contract highs in 2025 contracts.	3)	Hog futures are at technical resistance levels. Any indication of reduced pork demand could trigger substantial liquidation.
4)	Pork demand is strong and the packers have been aggressive as they maintain increased slaughter speeds.	4)	Packers have sufficient hogs available and do not need to be aggressive with purchases even though slaughter speeds are higher. Once they have purchased hogs for the week, cash prices decline.

Monday Closing Livestock Market Update - Strong Demand Helps Keep the Contracts Elevated

GENERAL COMMENTS:

The livestock complex started the week out on a strong note as all three of the markets closed mostly higher Monday afternoon. Again this week demand will play a key role in the market's direction as traders are looking for fundamental support in order to justify trading the contracts any higher as they're up against resistance pressure. December corn is up 1 1/4 cents per bushel and December soybean meal is down $6.50. The Dow Jones Industrial Average is down 398.51 points.

LIVE CATTLE:

The live cattle complex traded higher throughout most of Monday's trade but upon seeing midday boxed beef prices higher, traders even began to support the nearby contracts which allowed the entire complex to close higher. It will be an interesting week for the live cattle market as traders have advanced the nearby contracts to their highest price point since the equity market meltdown in early August, and the cash cattle market has been able to trade higher for the last four weeks in a row. But now with the market up against resistance levels, everyone is wondering if the complex will be able to maintain its upward trend throughout the week. Thankfully boxed beef prices are up sharply, which should encourage feedlot managers to again price their showlists higher, and hopefully it will encourage packers that demand is strengthening. But it's highly unlikely that any cash cattle trade will develop ahead of Wednesday as undoubtedly packers and feedlots managers will go toe-to-toe again this week. October live cattle closed $0.47 higher at $187.47, December live cattle closed $0.02 higher at $187.02 and February live cattle closed $0.35 higher at $188.30. Monday's slaughter is estimated at 110,000 head -- 9,000 head less than a week ago and 13,000 head less than a year ago. New showlists appear to be somewhat higher in Nebraska/Colorado and Texas, and higher in Kansas.

Last week Southern live cattle traded for $186 which is $1.00 higher than the previous week's weighted average, and Northern dressed cattle traded at $296 which is $2.00 higher than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 59,356 head. Of that, 82% (48,748 head) were committed to the nearby delivery, while the remaining 18% (10,608 head) were committed to the deferred delivery option.

Boxed beef prices closed higher: choice up $3.35 ($305.93) and select up $1.72 ($289.33) with a movement of 106 loads (52.90 loads of choice, 25.84 loads of select, 10.93 loads of trim and 15.88 loads of ground beef).

TUESDAY'S CATTLE CALL: $1.00 to $2.00 higher. I know that packers are going to cut throughput this week, but feedlot managers are in a position in which if they don't like the prices they're being offered they can simply hold onto their inventory and roll this week's showlist to the next week if prices are strong enough.

FEEDER CATTLE:

Even though the live cattle complex rounded out the day fully higher, the feeder cattle market's nearby contracts remained reluctant to trading higher, but the deferred months rallied with ease. October feeders closed $0.77 lower at $248.85, November feeders closed $0.12 lower at $249.15 and January feeders closed $1.80 higher at $246.17. Part of the reason why the nearby feeder cattle contracts closed slightly lower was due to the fact that traders weren't willing to take out the market's resistance at its 100-day moving average. If demand in the countryside remains incredibly strong for feeders this week and the live cattle/fed cash cattle market lends ample support -- then trades may take on that threshold later this week, but doing so on Monday seemed too ambitious to traders. At Joplin Regional Stockyards in Carthage, Missouri compared to last week feeder steers weighing under 500 pounds sold $10.00 to $30.00 higher, feeder heifers over 500 pounds sold $2.00 to $8.00 higher. Feeder heifers under 550 pounds sold $5.00 to $25.00 higher with the heavier weights trading $5.00 lower. Feeder cattle supply over 600 pounds was 74%. The CME feeder cattle index 10/4/2024: up $0.70, $247.48.

LEAN HOGS:

The lean hog complex traded higher throughout Monday's market as traders were pleased to see pork cutout values well supported throughout Monday's trade. The only two cuts that closed slightly lower were the rib (down $0.54) and the ham (down $0.55) but otherwise the rest of the cuts closed higher. Demand will continue to remain a top priority for traders if they're going to be able to continue with the market's upward trend. December lean hogs closed $0.67 higher at $76.82, February lean hogs closed $0.77 higher at $80.60 and April lean hogs closed $0.72 higher at $84.87. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $1.79 with a weighted average price of $76.68 on 1,321 head. Pork cutouts total 338.08 loads with 268.15 loads of pork cuts and 69.94 loads of trim. Pork cutout values: up $1.74, $96.05. Monday's slaughter is estimated at 488,000 head -- 3,000 head more than a week ago and 7,000 head more than a year ago. The CME lean hog index for 10/3/2024: down $0.07, $84.83.

TUESDAY'S HOG CALL: Higher. With Monday's cash market hardly tested and pork cutout values closing higher Monday afternoon, it's likely that packers are more aggressive on Tuesday in the cash hog market.

Monday Midday Livestock Market Summary -

GENERAL COMMENTS:

The livestock complex is trading mostly higher although some of the nearby cattle contracts are trading slightly lower. If traders are going to continue to support the livestock complex as confidently as they did last week, they're going to need to see strong fundamental support in order to sustain these levels. December corn is up 1 3/4 cents per bushel and December soybean meal is down $5.80. The Dow Jones Industrial Average is down 246.01 points.

LIVE CATTLE:

The live cattle complex is trading mostly higher, although some of the nearby contracts are trading slightly lower as traders hope to find stable fundamental support in this week's market. October live cattle are up $0.32 at $187.32, December live cattle are down $0.17 at $186.82 and February live cattle are up $0.02 at $187.97. After traders ran the complex to its highest price point seen since late July, they now need fundamental reassurance that the move was merited. Thankfully boxed beef prices are strong at the start of the week, which should lend some support, but throughout the week traders will continue to monitor beef demand and any developments in the cash market. No bids or asking prices are noted at the time and trade won't likely develop until after Wednesday at some time.

Last week Southern live cattle traded for $186 which is $1.00 higher than the previous week's weighted average, and Northern dressed cattle traded at $296 which is $2.00 higher than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 59,356 head. Of that, 82% (48,748 head) were committed to the nearby delivery, while the remaining 18% (10,608 head) were committed to the deferred delivery option.

Boxed beef prices are higher: choice up $2.79 ($305.37) and select up $2.72 ($290.33) with a movement of 58 loads (32.64 loads of choice, 9.56 loads of select, 4.12 loads of trim and 11.46 loads of ground beef).

FEEDER CATTLE:

The feeder cattle complex is also trading mixed as traders note the slight regression in some of the nearby live cattle contracts, but all in all, most of the contracts are trading higher especially the spring and summer 2025 contracts as supplies of feeder cattle will likely be thin during that time. October feeders are down $0.42 at $249.20, November feeders are down $0.10 at $249.17 and January feeders are up $0.57 at $245.02. Last week the CME feeder cattle index rounded out the week at $246.78 -- indicating that buyer demand remains strong and hopefully will again this week.

LEAN HOGS:

The lean hog complex is trading confidently into Monday's noon hour as the market is noting the stronger demand in pork cutout values early in the week. October lean hogs are down $0.07 at $83.90, December lean hogs are up $0.92 at $77.07 and February lean hogs are up $0.90 at $80.72. But in order for traders to move the complex any higher given that the market is trading at current resistance levels, they'll need to see stable consumer demand and interest.

The projected lean hog index for 10/4/2024 is down $0.57 at $84.26, and the actual index for 10/3/2024 is down $0.07 at $84.83. Hog prices are unavailable on the Daily Direct Morning Hog Report due to confidentiality issues. However, we can see that only 136 head have traded and that the market's five-day rolling average now sits at $77.32. Pork cutouts total 205.84 loads with 166.51 loads of pork cuts and 39.33 loads of trim. Pork cutout values: up $2.17, $96.48.

Monday Morning Livestock Market Update - Feedlots Will Try to Squeeze More Out of Packers This Week

GENERAL COMMENTS:

Feedlots held out last week and were rewarded with higher cash trade. Southern live cattle traded $1.00 higher and Northern dressed cattle traded $2.00 higher. October live cattle futures closed higher to adjust to the higher cash. Support also stemmed from strong gains in boxed beef as choice gained $2.78 and select gained $4.32. Live cattle futures were unable to push above the highs of Wednesday and Thursday following the higher cash and cutouts, which could increase the potential for some liquidation if boxed beef prices decline early this week. The feedlots will try to squeeze more out of the packers again this week. The Commitments of Traders report showed fund traders increasing their live cattle long futures positions by 10,878 contracts, moving to a total long position of 67,888 contacts. Fund traders were net buyers of 3,752 contracts in feeder cattle, increasing their net long futures position to 4,803 contracts.

Hog futures closed lower Friday but not without making new highs for the current trend. The packers needed to purchase hogs to finish the week and bid higher to obtain them. The National Direct Afternoon Hog report showed cash up $0.90. The slight pressure on futures was due to the weakness seen in cutouts as they closed $0.49 lower. Traders anticipate higher prices through the end of the year but December futures hold at an $8.00 discount to the October contract. The market will need to prove itself. The Commitments of Traders report showed the fund traders increasing their long futures position by 5,016 contracts to 63,841 contracts.

	BULL SIDE		BEAR SIDE
1)	Feedlots will hold for higher cash again this week as holding out the past two weeks has been rewarded with higher cash prices.	1)	Cattle futures have the higher cash already factored into the market, which may limit the upside early this week.
2)	The trend is up and beef demand may be improving. This may continue to provide support to the market.	2)	Boxed beef prices need to show further strength or cattle futures may trend lower this week.
3)	Hog futures made a new high Friday, keeping the uptrend intact. Traders anticipate demand will continue to improve.	3)	Hog futures are nearing technical resistance and a failure to close above that level could trigger some liquidation.
4)	The packers should be aggressive Monday as they will be ready to purchase hogs to get started on the week. Higher cash Friday indicates good demand.	4)	Cutouts lack the consistency of a higher trend. Continued choopy coutout prices may limit the upside price potential.