Wednesday Closing Livestock Market Summary - Livestock Contracts Close Lower

GENERAL COMMENTS:

Remember that uncle we talked about a while ago? The man who couldn't function when things went right, so he fell off the wagon and started drinking again? Well, the wagon may have gotten bigger and more of the market jumped on. And to boot, there's nothing like hearing that China has reached a deal to buy $100 million worth of pork for the 2020 calendar year to sour your day.

Hog prices on the National Direct Afternoon Hog Report are lower, down $0.80 with a weighted average of $45.15. December corn is down 3 cents per bushel and December soybean meal is down $3.80. The Dow Jones Industrial Average is down 0.07 points and NASDAQ is down 24.05 points.

LIVE CATTLE:

Live cattle contracts fared the day the best. Deferred contracts suffered more than nearby. December live cattle closed $0.45 lower at $119.00, February live cattle closed $0.02 higher at $124.70 and the April board closed $0.27 lower at $125.55. If there's going to be a spark this week, it's going to be in the live cattle cash trade. Despite another day being at an utter standstill, there is hopefulness in the patience of anxious feeders.

Closing boxed beef prices are higher: choice up $1.09 ($237.14) and select up $1.71 ($211.53) with a total movement of 132 loads (66.56 loads of choice, 25.29 loads of select, 11.05 loads of trim and 28.66 loads of ground beef). Wednesday's slaughter is estimated at 118,000 head, that's 1,000 head more than a week ago and 2,000 head less than a year ago.

THURSDAY'S CASH CATTLE CALL: $1.00 higher. It wouldn't be surprising to see cash cattle wait to trade until the week's very end. Some cattle may start trading Thursday, but in order to get the expected $2.00-plus rally that many anticipate, trade will probably have to hold out another day.

FEEDER CATTLE:

On an estimated run of 4,073 head (down 2,710 head from last week) Mobridge Calf Auction in Mobridge, South Dakota, sold steer calves 450 to 700 pounds mostly steady with instances of $3.00 lower on 650 to 700 weights. Heifers calves weighing 400 to 650 pounds sold mostly steady. Moderate to good demand for Wednesday's offering of packages and loads featuring many Red Angus calves. Best demand is seen for heifer calves suitable for replacements.

The feeder cattle market closed lower: November contract down $1.05 at $146.80, January feeders down $1.35 at $144.42 and March feeders down $1.22 at $143.97. Given that a cold front is expected to float over parts of cow-calf country this week, sale barns could see a ramification if roads are too slick for trucks to get into town. The CME feeder cattle index 11/5/19: up two cents at $146.26.

LEAN HOGS:

The livestock complex was pressured enough by simple midweek weakness, but hearing that China has reached a deal to buy $100 million worth of pork for the 2020 calendar year from European pork producers put U.S. hog producers in a bind. Many analysts have wondered if the trade bantering between the U.S. and China continues, if China will make a deal at all before the next presidential election. On one hand, it's safe to say that China is at the end of their rope with the United States regarding trade agreements. On the other hand, the fact remains that China needs pork protein. If the United States can't secure more of a market share into the Chinese market as a pork supplier, our farmers will be severity affected.

December lean hogs closed $2.50 lower at $64.77, February lean hogs are down $0.97 at $72.77 and April lean hogs closed down $0.60 at $79.37. Pork cutouts totaled 324.73 loads with 289.62 loads of pork cuts and 35.11 loads of trim. Pork cutout values: up $1.44 at $80.94. The CME lean hog index 11/4/19: down $0.52 at $60.36.

THURSDAY'S CASH HOG CALL: $1.00 lower. News briefings like the one listed earlier has a way of negatively affecting countryside psychology.

#completeherdhealth

Wednesday Midday Livestock Market Summary - Livestock Contracts Slip Lower

General Comments

Ya can't win for losin' livestock contracts. Headed south seems to be the theme Wednesday morning as all livestock contracts are lower and continue to trade lower as the morning progresses. December corn is down 1/4 cent per bushel and December soybean meal is down $1.80. The Dow Jones Industrial Average is down 40.29 points and NASDAQ is down 40.74 points

LIVE CATTLE

Live cattle contracts etch lower and lower with deferred contracts taking the biggest hit. December live cattle are down $0.82 at $118.62, February live cattle are down $0.50 at $124.17 and April live cattle are down $0.60 at $125.20. Trading lower than Tuesday's close it makes one wonder if the correction we have been talking about has arrived. Regardless if it has, or if the week will turn around to close steady to higher compared to last week - it would be a shock to see cash cattle trade anything but steady to higher. Given that packers are still making plenty of money on the retail side of things, they have every incentive they could possibly need to keep processing cattle rapidly.

The countryside has been quiet Wednesday morning. Asking prices of $117 are circulating the South and $185-plus in the North. The Fed Cattle Exchange Auction reported a total of 547 head, with one lot in Texas, three lots in Nebraska, and two lots in Kansas. Asking prices were at $113 and $117. Two lots were noted as sold, but the sellers passed on these offers (Texas lot at $114, and Kansas lot at $113).

Midday boxed beef prices are higher: choice up $0.68 ($236.73) and select up $1.52 ($211.34) with a movement of 54 loads (30.97 loads of choice, 10.79 loads of select, zero loads of trim and 12.61 loads of ground beef).

FEEDER CATTLE

Live cattle contracts slip lower, but feeder cattle contracts slip even lower than the live cattle prices. November feeder cattle are down $1.12 at $146.72, January feeder cattle are down $1.57 at $144.20 and March feeder cattle are down $1.62 at $143.57. A snow storm that has moved across some of the Northern country could put a damper on some of the sale barns this week. Feeder cattle prices are largely reciprocating the negative energy from the rest of the complex.

LEAN HOGS

Oh, of course after a strong close Tuesday, headlines sharing that Chinese President Xi Jinping thinks next week's trip to Brazil may come too soon for him to be able to sign the Phase One trade deal with the United States. Lean hog contracts have since given up all of what Tuesday gained and continue to trade lower. December lean hogs are down $2.57 at $64.70, February lean hogs are down $1.20 at $72.55 and April lean hogs are down $1.12 at $78.85.

The two-day lean hog index for 11/04/19 is down $0.52 at $60.36, and the actual lean hog index for 11/01/19 is down $1.22 at $60.88. Hog prices are down on the National Direct Morning Hog Report, down $0.18 with a weighted average of $46.63, ranging from $43.00 to $47.34 on 8,424 hogs sold and a five-day rolling average of $48.58. Pork cutouts totaled 186.90 loads with 165.84 loads of pork cuts and 21.06 loads of trim. Pork cutout values are lower, down $1.08 at $78.42.

#completecalfcare

Wednesday Morning Livestock Market Summary - Cattle Futures Searching For Additional Support

GENERAL COMMENTS:

Limited interest in cash cattle trade so far this week. The underlying bullish tone in cattle futures continues to spark expectations of renewed cash price support once the dust settles at the end of the week. Bids and asking prices are still hard to pin down Wednesday morning, but it is likely more cattle will be priced at higher levels before the end of the day. Active trade will probably be delayed until Thursday or Friday. But the building packer margins and continued underlying support through the entire complex will likely spark renewed resolve in feedlot managers. Futures are called mixed as traders look for additional stability at or near short-term highs seen early in the week. Although firm to moderate pressure held in feeder cattle trade Tuesday, the focus on prices well above the 40- and 100-day averages in both markets is sparking underlying buyer support. Wednesday slaughter runs are expected at 118,000 head.

Underlying firmness to continue through lean hog futures at midweek. Some momentum seems to remain from the news that China is opening imports from Canada. Although it would be better news if the agreed exports were coming from the U.S., the general consensus is this is one step closer to getting additional short-term exports into China. And, with more exports from Canada moving to China, we have the opportunity to fill a gap by exporting more pork to our northern neighbor. But we need to remember the aggressive triple-digit gains of Tuesday still leave contracts near the bottom end of long-term price ranges, with a lot of upward market potential if any significant export trade develops over the coming weeks. Cash hog values are expected to be steady to $1 per cwt lower, with most bids expected steady to 50 cents lower. Expected slaughter Wednesday is at 490,000 head.

	BULL SIDE		BEAR SIDE
1)	Strong underlying support continues to develop in early 2020 contracts as traders focus on expected supply pressure in the first quarter of New Year. This is expected to limit downside market pressure over the next several months.	1)	Feeder cattle futures have stabilized through early November, creating concerns that further support may be challenging through the next couple of weeks. The inability of January futures to move above $146 per cwt and hold these levels through the holiday season may limit long-term support through the complex.
2)	Continued strong market momentum across the entire cattle complex during early November is sparking expectations of additional cash market support through the end of the week. This is limiting feeders floating asking prices at this point in the event of further bullishness as the week continues.	2)	Mixed boxed beef values Tuesday may indicate the recent surge in wholesale values may be slowing significantly following the recent market support. This could create underlying softness in the nearby contracts based on expected seasonal demand slumps typically seen over the holidays.
3)	December lean hog futures nearly hit limit gains Tuesday as expectations of increased export demand moving to China continue to make traders and most market watchers salivate with anticipation.	3)	Despite renewed buyer optimism in lean hog futures, the lack of confirmation that aggressive Chinese imports from the U.S. are in the near future could quickly sour trader attitudes.
4)	Summer 2020 lean hog contracts continue to hold a wide market premium based on expected demand support, both domestic and export, through the next year. This is helping take some attention off short-term market moves as traders look for better market developments next summer.	4)	Continued strong seasonal hog production continues to provide abundant pork. Without aggressive short-term increases of exports to either China or significant increases to our other trading partners, continued market support will be hard to sustain.

#completeforageprogram

Tuesday Closing Livestock Market Summary - Livestock Contracts Close Mixed

GENERAL COMMENTS:

Upon tuning into Tuesday afternoon's U.S. Meat Export Federation Call, it's safe to say there is a growing need for both U.S. beef and pork products and it looks fruitful for the upcoming 2020 export opportunities. Hog prices are lower on the National Direct Afternoon Hog Report, down $0.73 with a weighted average of $46.08. December corn is down 1 1/2 cents per bushel and December soybean meal is up $0.30. The Dow Jones Industrial Average is up 30.52 points and NASDAQ is up 1.48 points.

LIVE CATTLE:

Initially Tuesday began the day will little motivation and an unwilling attitude to see anything but lower prices, but as the day progressed, live cattle contracts rebounded some from the day's low. Live cattle contracts closed the day mixed. December live cattle closed $0.62 lower at $119.45, February live cattle closed $0.07 higher at $124.67 and April live cattle closed $0.25 higher at $125.82. Cash cattle trade is still at a standstill and will probably wait until sometime Thursday or Friday to really get underway.

Closing boxed beef prices are mixed: choice up $1.24 ($236.05) and select down $0.56 ($209.82) with a movement of 115 loads (60.54 loads of choice, 29.18 loads of select, 5.09 loads of trim and 20.62 loads of ground beef). Tuesday's slaughter is estimated at 119,000 head - 6,000 head more than a week ago, and 3,000 head less than a year ago.

WEDNESDAY'S CASH CATTLE CALL: Steady to $1.00 higher. Given that this week is following in the same path as last week and cash prices are expected to be higher. It's very promising that the live cattle contracts closed mixed Tuesday rather than all lower. Cash trade may wait until later in the week to trade, but when trade does get underway it will most likely be for more money.

FEEDER CATTLE:

On an estimated run of 855 head (up 319 head from the previous week) Billings Livestock Commissions in Billings, Montana, sold feeder steers and heifers steady to firm compared to the previous week. Demand for calves was mostly moderate for light to moderate offerings. Market activity was slow to moderate depending on quality of the stock and at what part of the day they sold.

Early in the day it looked like the feeder cattle market was going to be able to close at least mixed, but the noon hour passed and any support that had surfaced soon vanished. November feeder cattle closed $1.22 lower at $147.85, January feeders closed $0.22 lower at $145.77 and March feeders closed $0.10 lower at $145.20. The CME feeder cattle index 11/04/19: down $0.21 at $146.24.

LEAN HOGS:

Tuesday's lean hog sector was largely stimulated by the announcement that China would be accepting pork and beef imports from Canada. And after hearing Tuesday's U.S. Meat Export Federation Call, one wouldn't think that it could be too much longer until the phase one deal is ironed out with the desperate need China has for more pork imports.

Pork cutouts totaled 392.26 loads with 347.28 loads of pork cuts and 44.98 loads of trim. Pork cutout values: up $0.75 at $79.50. The CME lean hog index 11/01/19: down $1.22 at $60.88.

WEDNESDAY'S CASH HOG CALL: Steady. Given that hopeful chatter continues to circulate the market, and that cutout values are up again, steady may not be a far stretch after all.

#completeherdhealth