GENERAL COMMENTS:
It was a mostly quiet day for the livestock complex as the contracts traded but nothing overly eventful transpired throughout the day. It's assumed that the cash cattle market will trade higher again this week, but it's too early in the week for any developments to have surfaced. March corn is down 1 3/4 cents per bushel and March soybean meal is up $1.30. The Dow Jones Industrial Average is down 418.48 points.
LIVE CATTLE:
The live cattle complex traded higher throughout the majority of the day, but some of the nearby contracts grew weary ahead of Monday's close. It wasn't from a lack of fundamental support however as boxed beef prices closed higher and it's assumed that cash cattle prices will trade higher again this week. But rather instead it seemed as though traders grew anxious about 'putting the cart before the horse' in this week's market as they'd like to see how the market's fundamentals play out. February live cattle closed $0.35 lower at $190.30, April live cattle closed $0.32 lower at $193.02 and June live cattle closed $0.05 lower at $188.77. Monday's slaughter is estimated at 123,000 head -- 5,000 head more than last week and incomparable to last year. New showlists appear to be mixed, higher in Kansas, and Nebraska/Colorado, but lower in Texas.
Last week Southern live cattle traded at mostly $192 which is $1.00 higher than the previous week's weighted average and Northern dressed cattle traded at mostly $307 which is also $1.00 higher than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 44,027 head -- of that 86% (38,032 head) were committed to the nearby delivery while the remaining 14% (5,995 head) were committed to the deferred delivery.
Boxed beef prices closed higher: choice up $2.99 ($325.37) and select up $3.63 ($294.76) with a movement of 104 loads (66.78 loads of choice, 18.14 loads of select, 4.89 loads of trim and 14.08 loads of ground beef).
TUESDAY'S CATTLE CALL: Higher. Over the last two weeks in the cash market, packers haven't been able to buy more than 50,000 head, which likely means that they'll need to buy more aggressively this week to avoid being short bought when regular kill schedules resume.
FEEDER CATTLE:
Around Monday's noon hour, I wasn't confident in whether or not the market's momentum would be strong enough to sustain a higher close by the day's end -- but thankfully support prevailed and the complex grew more confident through the afternoon's hours. January feeders closed $0.25 higher at $261.62, March feeders closed $0.50 higher at $261.05 and April feeders closed $0.22 higher at $261.27. I think it's rather telling of the market's current state that not only did the contracts remain above the market's resistance threshold at $260 -- but in fact, traders took it a step further and pushed the nearby contracts above $261 seeming to indicate that the market's trajectory is higher. The CME feeder cattle index 12/27/2024: down $4.35, $253.97.
LEAN HOGS:
Although cash hog prices closed slightly higher, the market wasn't willing to change its direction as the board's downward trend was set in motion earlier today and traders weren't going to be reckoned with. It wasn't helpful however that pork cutout values closed slightly lower, with the biggest hit coming from the ham's $7.01 decline. February lean hogs closed $2.52 lower at $81.62, April lean hogs closed $2.47 lower at $87.05 and June lean hogs closed $2.30 lower at $99.70. Hog prices closed higher on the Daily Direct Afternoon Hog Report, up $1.54 with a weighed average price of $78.81 on 1,725 head. Pork cutouts totaled 425.49 loads with 390.93 loads of pork cuts and 34.55 loads of trim. Pork cutout values: down $0.71, $94.36. Monday's slaughter is estimated at 490,000 head – steady with last week and incomparable to a year ago. The CME lean hog index 12/26/2024: down $0.25, $84.85.
TUESDAY'S HOG CALL: Steady. Given that packers weren't overly aggressive in last week's market, it's likely that they're going to need to buy more supply this week to keep from becoming short bought.
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