Friday Midday Livestock Market Summary - Cards Are Down for Livestock Contracts

General Comments

Largely supported by the lavish gains in the cash cattle trade, cattle contracts step higher while the lean hog market takes the back burner.

December corn is down 2 1/4 cents per bushel and December soybean meal is up $0.80. The Dow Jones Industrial Average is up 237.07 points and NASDAQ is up 54.21 points.

LIVE CATTLE

Remember the song, "The Devil Went Down to Georgia," by Charlie Daniels? Part of the song sings, "guess you didn't know it but I'm a fiddle player too, and if you'd care to take a dare, I'll make a bet with you. Now you play a pretty good fiddle boy but give the devil his due I'll bet a fiddle of gold against your soul, 'cause I think I'm better than you. The boy said, "my name's Johnny and it might be a sin, but I'll take your bet

"And you're gonna regret 'cause I'm the best there's ever been".

This week's cash cattle market feels like the fiddle playin' that went on in Charlie Daniels' song. Nebraska sold some dressed cattle live for $180.00 ($5.00 higher than last week's weighted average) for delivery in two weeks, the week of 11/18/19. Now you might shrug your shoulders and say God gave Johnny his fiddle playing skills so what's the big fuss and any time you can have a $5.00 cash rally trumpets should sing and fireworks should be lit off like it's the 4th of July ... BUT ... There are a couple of big variables floating around that could impose some pressure on the cash cattle market. First, any time cattle are sold with delayed delivery you cringe a little for the cattle that will be sold in the time in between now and then. Secondly, slaughter has been strange this week, and much lower than anticipated. Packers could make it up in a big Saturday kill, but you never know until the reports slide across your desk. Nevertheless, Friday's cash cattle trade was a win for the week, but it may cause some stress in the upcoming weeks if packers pull back their slaughter efforts and boxed beef prices decided they've rallied enough.

Midday boxed beef prices are higher: choice up $0.16 ($232.34) and select up $0.42 ($206.91) with a movement of 45 loads (16.44 loads of choice, 17.07 loads of select, 2.61 loads of trim ad 9.22 loads of ground beef).

FEEDER CATTLE

Thursday's sideways trade paid off for the feeder cattle market. Nearby and deferred contracts are all rallying well over a dollar. November feeder cattle are up $1.37 at $148.97 and January feeder cattle are up $1.65 at $146.32. Sale barn markets this past week held their ground but saw some softer sales when weather impacted the turn out. For most of the country this upcoming week should yield better weather.

LEAN HOGS

Ya can't win them all, lean hog contracts, ya can't win them all. Despite a well-attempted effort to keep the board at least steady, lean hog contracts have weakened and let the cattle contracts take the lime light. December lean hogs are down $2.07 at $63.90 and February lean hogs are down $1.20 at $72.12. It's doubtful that the second half of the day will rebound much if any at all.

The projected lean hog index for 10/31/19 is down $0.65 at $62.10, and the actual index for 10/30/19 came in down $0.39 at $62.74. Prices are higher on the National Direct Morning Hog Report, up $0.54 with a weighted average of $49.59, ranging from $45.00 to $50.47 on 4,825 head and a five-day rolling average of $50.88. Pork cutouts totaled 150 loads with 117.59 loads of pork cuts and 32.41 loads of trim. Pork cutout values are done $1.36 at $74.69.

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Friday Morning Livestock Market Summary - New Month, New Direction?

GENERAL COMMENTS:

Packers and feeders still have a lot of work to do before the end of the week. Although a few additional cattle sold Thursday in the South steady with Wednesday's rally of $2 per cwt higher than last week, a lot of cattle still need to find a home before the end of the day. Packer interest should improve through the morning, although it could be mid- to late-afternoon before the two sides can agree on price levels and active trade develops. Both sides will continue to hold their line through much of the morning with asking prices expected around $114 to $113 live in the South and $180 to $182 dressed in the North. Early bids are not likely to change significantly from those passed over the last couple of days. Mixed trade is expected Friday morning, focusing on the pullback, which developed Thursday. The losses can easily be explained away as end-of-month profit taking, given the recent market rally and expectations through the complex that a correction was due. Uncertainty remains if buyers are yet willing to step back into the complex, or if they feel additional market pressure is in store through the end of the week. Even if prices continue to shift lower Friday, this does not indicate aggressive long-term pressure will follow next week, as traders still have to make a decision if prices will continue higher in early November, or establish a sideways trend near these recent highs. Friday slaughter runs are expected at 116,000 head.

Lean hog futures are expected mixed in early trade Friday. The ability for lean hog futures to end the day Thursday following aggressive triple-digit morning losses is viewed as bullish, but it is uncertain if this support will continue through the end of the week. The entire market is starting to get tired of the "will they, or won't they" news cycle and mentality when it comes to China and a partial trade agreement. Given the history over the past year, this should not surprise anyone. But there is so much additional hope built into the entire process, that it is hard not to get sucked into the drama developing ahead of anything planned. The ability of nearby contracts to close higher Thursday and potentially spark additional gains Friday has little to do with bullish market expectations, just that there is little additional news available to suggest breaking outside of the current trading range. Cash hog values are expected to be steady to $1 per cwt lower, with most bids expected steady to 50 cents lower. Expected slaughter Friday is at 482,000 head. Saturday runs are expected a 235,000 head.

	BULL SIDE		BEAR SIDE
1)	Support in boxed beef values has remained strong through the last half of October. This suggests overall support remains at a time when seasonality indicates market softness. This points to continued underlying support through the near future.	1)	Given aggressive gains during October, traders were disappointed by the lack of follow-through interest at the end of the month. This crack in resolve leaves the door open for further back-pedaling in early November.
2)	Additional cash cattle trade is still needed in most areas, although early Southern trade is expected to have set the tone for higher prices through the week. Unless a major shift is seen in futures trade Friday, feeders will remain aggressive with cattle prices through the end of the week expecting gains of $1 to $3 per cwt higher than last week.	2)	Cattle weights continue to shift higher, indicating that even with the increased cash and futures prices over the last several weeks, market currentness has not yet been reached.
3)	The ability of lean hog futures to regroup following generally disappointing China export results Thursday morning is showing increased resolve through the complex. The ability to build off early week lows in all nearby contracts could help to boost underlying market support during early November.	3)	Cash hog prices continue to erode with packers still struggling to keep up with abundant hog supplies. This is expected to continue through early November, limiting the need for added money in order to fill procurement needs.
4)	Despite back-and-forth speculation on whether a partial trade deal will be agreed upon in November, there is still hope and some underlying confidence that positive developments will be seen. This is helping build additional support into deferred contracts as traders look for long-term market help.	4)	Concerns circulated from China putting doubts on if an agreement will be able to be reached in the near term. With no definite timeline or place for a meeting to replace the one scheduled for mid-November, even more uncertainty is in the complex.

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Thursday Closing Livestock Market Summary - What Are You Doin' Livestock Contracts?

GENERAL COMMENTS:

At noon, we told Annie to bar the door, but maybe we should have let her keep it open so the market could figure itself out. Of all things, the hog market that is lacking export opportunities has too much supply, and that now has the rest of the trade sector worried too because Chinese officials are expressing doubts about reaching a deal with the U.S.

Hog prices are lower on the National Direct Afternoon Hog Report, down $0.36 with a weighted average of $49.07. December corn is down 3/4 cent per bushel and December soybean meal is up $2.20. The Dow Jones Industrial Average is down 140.46 points and NASDAQ is down 11.62 points.

LIVE CATTLE:

Live cattle contracts bounced around the most Thursday, indicating that the market didn't know where to fall. Despite its varying prices throughout the day, it's a positive sign that the market was able to keep within Wednesday's parameters. December live cattle closed $1.07 lower at $117.22 and February live cattle closed $0.75 lower at $122.35. A lot of questions will be answered Friday. Was Wednesday's rally a fluke? Or will cash prices boost the board's moral and trade higher? Time will tell.

Some cash trade took place in Kansas with prices steady with Wednesday's gains -- $112.00, which is $2.00 higher than last week's weighted average. Thursday's slaughter is estimated at 118,000 head -- steady with last week, 4,000 head less than a year ago.

Closing boxed beef prices are mixed: choice up $2.13 ($232.18) and select down $0.18 ($206.49) with a total movement of 117 loads (72.67 loads of choice, 23.85 loads of select, no loads of trim and 20.69 loads of ground beef).

FRIDAY'S CASH CATTLE CALL: Steady to $1.00 higher. Feeders are holding out again this week, and with packers itching to keep getting fat checks from the retail sector, they may be anxious to buy even if it is for higher money than last week.

FEEDER CATTLE:

On an estimated run of 2,500 head (down 558 head from the previous week) Huss Livestock Market in Kearney, Nebraska, sold steer calves compared to last week unevenly steady. Heifer calves sold steady to $3.00 higher and yearling heifers sold $2.00 higher. Demand was noted to be good on yearlings with moderate to good demand on calves. Buyers preferred calves with preconditioned shots instead of calves that had just had their spring vaccines. They exited to have more calves than before, but because of icy roads and snow not as many came to town. The feeder cattle market fared better than the live cattle market did. November feeder cattle down $0.27 at $147.60 and January feeder cattle down $0.12 at $144.67. The CME feeder cattle index 10/30/19: up $0.15 at $145.23.

LEAN HOGS:

The lean hog market was the only livestock facet able to close the day higher. All nearby and deferred contracts closed $0.05 to $0.87 higher. December closed $0.22 higher at $66.00 and February lean hogs closed only $0.05 higher at $73.32. Thursday's market being able to close above Wednesday's rally was huge in the hog market. Pork cutouts totaled 327.27 loads with 293.75 loads of pork cuts and 33.51 loads of trim. Pork cutout values: up $0.61 at $76.05. The CME lean hog index for 10/29/19: down $0.38 at $63.13.

FRIDAY'S CASH HOG CALL: Steady. Given that the board captured gains above Wednesday's close, the market may have a sliver of hope to either trade steady cash Friday or maybe even some higher. Despite what the board is doing, we have to remember that the countryside is flooded with hogs and it's always tough to sell on a saturated market for more money.

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Thursday Midday Livestock Market Summary - Livestock Markets Feeling Indecisive

General Comments

Annie bar the door because the livestock market doesn't know if Wednesday's rally was too much, about right or where Thursday's trade needs to stabilize at. If markets can stay within Wednesday's means, then day could be seen as a success. If markets close on the upper end of the spectrum, bulls will party and bears will cuss. If the markets close at Wednesday's low or lower, bulls with pout and bears will remind everyone that this correct was well announced. December corn is down 3 1/2 cents per bushel and December soybean meal is up $0.20. The Dow Jones Industrial Average is down 213.50 points and NASDAQ is down 33.54 points.

LIVE CATTLE

December live cattle are down $1.20 at $117.10, February live cattle are down $0.90 and the rest of the complex follows in the same pursuit not knowing whether or not Wednesday's rally was a good thing or not. Given the fact that the live cattle market is trading safely within Wednesday's parameters gives some sort of a bullish feel. The true knowing if Wednesday's rally was a success or flop won't probably be known until Thursday's close and then reassured again on Friday.

Packers are waiting patiently to see how Thursday's board pans out to see what countryside psychology can be played this go around. Thursday morning has been quiet so far and it wouldn't be surprising to see the large majority of trade wait until sometime Friday to really get underway.

Tuesday's slaughter was revised to 113,000 head (4,000 head lower than anticipated). With Wednesday's kill that puts the week at 348,000 head. In order to reach the week's expected harvest of 650,000 head, Saturday's kill will have to larger than initially assumed.

Midday boxed beef cutouts are mixed: choice up $1.62 ($231.67) and select down $0.18 ($206.49) with a movement of 62 total loads (31.30 loads of choice, 17.24 loads of select, zero loads of trim and 13.66 loads of ground beef).

FEEDER CATTLE

Feeder markets are holding onto Wednesday's rally better than the live cattle market is. November feeder cattle are down $1.00 at $146.87, January feeder cattle are down $1.10 at $143.70 and the rest of the complex is down merely the same. Perhaps roles will shift this time around and the feeder cattle markets levelness will seep into the live cattle market.

LEAN HOGS

Oddly enough, the lean hog sector is the only market showing signs of support Thursday morning. Deferred contracts rally anywhere from $0.20 to $0.50, while nearby contracts suffer like the rest of the livestock market. December lean hogs are down $0.47 at $65.30 and February lean hogs are down $0.32 at $72.95. U.S. pork exports are up 327,200 metric tons in 2019 compared to the 2018 calendar year. Exports to China (up 219,500mt) and Mexico (up 95,600mt) have been the biggest markets this year.

The project lean hog index for 10/30/19 is down $0.39 at $62.74, and the actual lean hog index for 10/29/19 came to $63.13 down $0.38. Prices are up on the National Direct Morning Hog Report, up $0.28 with a weighted average of $49.71, ranging from $46.00 to $51.14 on 4,302 hogs sold and a five-day rolling average of $51.41. Pork cutouts totaled 163.39 loads with 141.21 loads of pork cuts and 22.18 loads of trim. Pork cutout values are up $1.99 at $77.43.

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