GENERAL COMMENTS:
Livestock futures surged higher once again Wednesday, with feeder cattle contracts once again leading the bullish market surge, posting gains of $3 per cwt or greater by late-day trade. This underlying support through the complex has moved spot month August feeder cattle contracts to new all-time highs, closing at $325.57 per cwt. The ability to break above last week's highs helped to spark renewed market optimism in all cattle trade through the end of the Wednesday trading session. Traders remain focused on the expectation that fundamental market support will continue to develop over the coming days, but given the current aggressive rise in prices, especially in feeder cattle markets, some market watchers are closely assessing the potential of a market correction in the near future. Hog prices closed higher on the Daily Direct Afternoon hog report, up $0.12 with a weighted average of $112.72 on 8,772 hogs. December corn closed up 4 1/4 at $4.24 and December soybean meal closed up $4.00 at $283.5. The Dow Jones Industrial Average is up 231.49 at 44,254.78.
LIVE CATTLE:
Live cattle futures posted strong triple-digit gains for the second straight trading session Wednesday afternoon. Although buyer support remained evident through the entire trading session, the ability for feeder cattle futures to move front-month contracts to all-time highs helped to bring additional buyer support back into the live cattle complex. August live cattle futures led nearby contracts higher with prices nearing $224 per cwt. Although this is setting contract highs for the spot month August contract, current prices are about $2 per cwt under all-time highs in live cattle futures. The ability to sustain these price levels and maintain the aggressive buying momentum is causing some to focus on the potential of breaking through this "glass ceiling" in the coming days or weeks. Continued strong beef demand and stable to strong economic indicators, combined with still tight beef supplies through the upcoming year, are likely to limit an aggressive market pullback. Although given the current market prices, price corrections could quickly develop. Cash cattle markets remain quiet midweek with just a few bids on the table in parts of Western Nebraska and Kansas, but they continue to be passed. Asking prices are around $232-plus in the South, but they are still not established in the North. Packer inquiry should continue to improve as the day progresses. Having said that, significant trade volume will likely be delayed until Thursday and/or Friday. August live cattle closed $1.50 higher at $223.9, October live cattle closed $1.48 higher at $220.75 and December live cattle closed $1.43 higher at $221.025.
Wednesday's slaughter is estimated at 117,000 head, steady with a week ago and 5,000 head less than a year ago.
Boxed beef prices closed lower: choice down $4.87 ($372.85) and select down $4.67 ($357.91) with a movement of 157.88 loads (116.72 loads of choice, 26.93 loads of select, 4.11 loads of trim and 10.12 loads of ground beef).
THURSDAY'S CATTLE CALL: Steady to $2 Higher. Cash market activity remains undeveloped midweek, although the recent support in futures trade and expectations that firm beef values will continue to develop are likely to keep feeders aggressive in pricing cattle through the end of the week.
FEEDER CATTLE:
Feeder cattle broke through last week's highs in late afternoon trade, closing at $325.57 per cwt. This has set both new contract highs and highs in the continuous chart. The aggressive support in all cattle markets, but especially feeder cattle trade, has kept markets extremely bullish as traders continue to focus on strong underlying market fundamentals, combined with technically strong market signals for now. Over the last year, feeder cattle futures have surged from $240 per cwt to current levels of $325 per cwt with only limited market adjustments. On one hand, bullish factors indicate the potential of additional upside market moves. But anytime a market moves as quickly and aggressively higher without a significant correction, traders and market watchers seem to become more and more cautious. This could lead to market volatility in the near future. August feeders closed $3.30 higher at $325.575, September feeders closed $3.48 higher at $325.85 and October feeders closed $3.50 higher at $323.975. The CME Feeder Cattle Index for July 14: up $0.81, $321.91.
LEAN HOGS:
Lean hog futures rallied higher Wednesday as traders seemed to gain market influence and momentum from the continued support in cattle trade, combined with firm support within most other commodity and stock markets midweek. Nearby contracts have bounced off of 2-month lows with October through February futures posting triple-digit gains. August contracts took over as spot month contracts on the exchange with the expiration of the July contracts, which left August futures the only contract trading above $100 per cwt. The wide price spread between August and October contracts continues to cast questions on overall demand support through the end of the year and most of 2026, with many traders still extremely cautious concerning overall tariff levels and the likely impact on export sales. Based on overall charts, the lean hog complex still remains moderately oversold, especially when compared to the rest of the livestock market, but demand uncertainty for the next year has many traders unwilling to be active long-term buyers at this point. August lean hogs closed $0.50 higher at $104.425, October lean hogs closed $1.23 higher at $88.7 and December lean hogs closed $1.28 higher at $80.45. Wednesday's hog slaughter is estimated at 477,000 head, 6,000 head more than a week ago and 3,000 head less than a year ago. Pork Cutouts totaled 253.83 loads with 227.53 loads of pork cuts and 26.30 loads of trim. Pork cutout values are up $0.72 at $114.74. The CME Lean Hog Index for July 14: down $0.06, $107.19.
THURSDAY'S HOG CALL: Steady to $1 Higher. Limited early morning direction is expected to be seen Thursday, although given the underlying support in all livestock trade, and growing stability in outside markets, packers will likely remain active buyers through the rest of the week.
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