GENERAL COMMENTS:
It was a headline sparking day for the cattle complex as the announcement that New World screwworm had been detected in a cow in Southern Mexico led APHIS officials to restrict cattle imports from Mexico. This obviously sparked higher feeder cattle prices as the U.S. is already short on feeder cattle supplies with its historically low beef cowherd. December corn is down 3/4 cent per bushel and January soybean meal is up $4.40. The Dow Jones Industrial Average is up 400.62 points.
Monday's Cold Storage Report shared that total red meat supplies in freezers were down 2% from the previous month and down 3% from last year. Total pounds of beef in freezers were up 5% from the previous month but down 3% from last year. Frozen pork supplies were down 7% from the previous month and down 3% from last year. Stocks of pork bellies were down 8% from last month and down 42% from last year.
LIVE CATTLE:
The live cattle complex rounded out the day mixed as some of the market's nearby contracts closed slightly lower, but the deferred contracts rallied through the day's end. The market would have liked to rally alongside the feeder cattle complex, but traders grew skeptical of supporting the contracts too much this early in the week. December live cattle closed $0.27 lower at $186.50, February live cattle closed $0.50 lower at $187.70 and April live cattle closed $0.30 lower at $189.65. Even with Monday's slightly lower close, the spot February contract maintained its position above the market's 40-day moving average. New showlists for the week appear to be steady to somewhat lower in Texas and Kansas, but slightly higher in Nebraska. No cash cattle trade developed throughout the day, but Southern asking prices are noted at $189. Monday's slaughter is estimated at 120,000 head -- 2,000 head more than a week ago and 4,000 head less than a year ago.
Last week Southern live cattle were traded at mostly $186 to $187, which is $1.00 to $2.00 higher than the previous week's weighted average. Northern dressed cattle were sold at mostly $290 which is fully steady with the previous week's weighted average. Last week's negotiated cash cattle trade totaled 67,329 head. Of that amount, 74% (49,697 head) were committed for the nearby delivery, while the remaining 26% (17,632 head) were committed for the deferred delivery.
Boxed beef prices closed higher: choice up $2.30 ($309.71) and select up $1.67 ($273.74) with a movement of 126 loads (74.03 loads of choice, 21.17 loads of select, 6.23 loads of trim and 24.91 loads of ground beef).
TUESDAY'S CATTLE CALL: Higher. Given that feedlot managers were able to move the cash market higher last week it's likely that they'll try to keep the market motivated and see prices trade higher again this week.
FEEDER CATTLE:
It was a wild day for the feeder cattle complex as the market jolted higher at Monday's opening bell. Traders heard the news that a finding of New World screwworm had been detected in a cow in the Southern Mexico state of Chiapas, which pushed the Animal and Plant Health Inspection Service (APHIS) to restrict cattle imports from Mexico.
The U.S. already has limited feeder cattle supplies given that the U.S. beef cowherd sits at a historical low, so the news that cattle imports from Mexico would be restricted drove the feeder cattle complex higher all throughout Monday's trade. While the initial hype of the news simmered throughout the day, it's likely that feeder cattle prices will continue to etch higher until import restrictions open back up. January feeders closed $1.17 higher at $255.47, March feeders closed $1.20 higher at $254.32 and April feeders closed $1.17 higher at $255.52. At Joplin Regional Stockyards in Carthage, Missouri compared to last week and at their mid-session point, feeder steers were trading steady to $15.00 higher, and feeder heifers were selling $5.00 to $20.00 higher. The feeder cattle supply was over 600 pounds at 79%. The CME feeder cattle index 11/22/2024: up $0.18, $254.72.
LEAN HOGS:
The lean hog complex powered throughout the day able to maintain its higher position through the day's close. It was helpful that pork cutout values were higher not only at midday, but on Monday's afternoon closing report too. The belly was the only major cut to see a lower ending price, but all the other cuts saw sizeable gains. The market could run into little technical pressure on Tuesday as traders have worked the contracts back up to resistance levels. December lean hogs closed $0.30 higher at $81.97, February lean hogs closed $0.25 higher at $85.92, and April lean hogs closed $0.30 higher at $90.12. Hog prices are unavailable on the Daily Direct Morning Hog Report because of confidentiality. However, we can see that only 1,840 head traded throughout the day and that the market's five-day rolling average sits at $83.31. Pork cutouts totaled 277.49 loads with 236.08 loads of pork cuts and 41.41 loads of trim. Pork cutout values: up $1.56, $93.33. Monday's slaughter is estimated at 489,000 head -- steady with last week and 13,000 head more than a year ago. The CME lean hog index 11/21/2024: down $0.43, $87.01.
TUESDAY'S HOG CALL: Higher. It's unlikely that packers will buy many hogs this week, but with pork cutout values slightly higher throughout Monday's trade, packer interest could be stronger on Tuesday.
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