Wednesday Midday Livestock Market Summary - Post-Election Day Jitters have Cattle Contacts on Edge

 General Comments

Cattle contracts merely tip-tapped into the day but as the noon hour approaches, support is building and has the feeder cattle market trading fully higher and the live cattle complex trading mixed. From the day's start, the lean hog market has been optimistic and trading mildly higher, and thus far the complex doesn't seem pressured to trade lower. December corn is down 1 3/4 cents per bushel and December soybean meal is up $6.00.

The Dow Jones Industrial Average is up 783.28 points and NASDAQ is up 487.17 points.

LIVE CATTLE

Live cattle contracts are hesitant to trade higher but with the encouragement from the feeder cattle contracts and higher boxed beef prices, the complex may scale fully higher in Wednesday's afternoon trade. December live cattle are down $0.72 at $107.10, February live cattle are down $0.30 at $110.00 and April live cattle are up $0.05 at $113.75. The day's cash cattle trade still sits painfully quiet as feedlots are determined to get higher prices this week for their cattle. Asking prices in the South have been set at $109 to $110, and the North has yet to share any of their asking prices. The Fed Cattle Exchange sold some heifers earlier in the day, but interest was limited and were mostly steady a week ago to slightly stronger. Bids are expected to develop later this afternoon, but the bulk of this week's cash cattle trade is anticipated to take place Thursday and Friday.

Wednesday's Fed Cattle Exchange offed a total of 634 head, and of that only 296 head sold. A couple loads of Texas heifers sold for $106.75 to $107.25 with delivery in the next 17 days, the other cattle went unsold.

Boxed beef prices are higher: choice up $0.83 ($210.27) and select up $1.09 ($196.54) with a movement of 95 loads (66.93 loads of choice, 9.68 loads of select, 7.87 loads of trim and 10.84 loads of ground beef).

FEEDER CATTLE

Feeder cattle contracts are taking the day's willing support and rallying as the corn market trade steady to slightly lower. November feeder cattle are up $0.22 at $136.35, January feeder cattle are up $0.45 at $133.62 and March feeders are up $0.25 at $133.40. As the market continues to build support day upon day over the last week, the feeder cattle market is getting closer to the market's 40-day moving average of $137.81. Warmer temperatures and dry conditions have been a blessing to cow-calf producers who are needing to ship calves and thankfully the weather's break in snow and cold conditions has also helped sale barns this past week.

LEAN HOGS

Trading in a sideways trend, the lean hog market will take any support the complex can get as strong resistance levels have kept the market from trading higher. December lean hogs are up $0.55 at $65.95, February lean hogs are up $0.95 at $66.47 and April lean hogs are up $0.80 at $68.97. The cattle complex was leery of the post-election marketplace, but the lean hog market saw an opportunity to trade modestly higher and did so from the day's start.

The projected lean hog index for 11/3/2020 is down $0.83 at $72.05, and the actual index for 11/2/2020 is down $0.60 at $72.88. Hog prices are lower on the National Direct Morning Hog Report, down $0.28 with a weighted average of $59.61, ranging from $56.00 to $60.01 on 4,245 head and a five-day rolling average of $60.80. Pork cutouts total 217.83 loads with 184.21 loads of pork cuts and 33.61 loads of trim. Pork cutout values: up $0.75, $83.74.

#completeherdhealth

Wednesday Morning Livestock Market Summary - Cattle Futures Defend Late October Gains

 General Comments:

Cash cattle interest remains sluggish in all areas of cattle country Wednesday morning. Although asking prices are still hard to pin down, cattle appear to be priced around $110 per cwt live basis. With lack of bids early in the week, and potentially delayed until later in the week, it may be sometime Thursday or Friday before active trade develops. Feeders still have not seen any cash market support developing from last week's futures market rally, but the hope that firming boxed beef values on Tuesday will stimulate positive price levels could add momentum to live and dressed cattle trade. Futures trade quickly ran out of gas late Tuesday, backing away from earlier support. This firm pressure in nearby live cattle and feeder cattle trade continues to add further concern to the short-term direction of the market. December live cattle futures continue to remain over $4 per cwt above October lows, but if the market continues to chip away at last week's gains, the concern that further market weakness may continue through late November. Traders are encouraged by the ability to push boxed beef higher during early week trade, but the uncertainty as to how much short-term support will develop in meat values could limit the upward price shifts in beef and futures trade over the next week. Feeder cattle futures started to trickle lower over the last two trading sessions, but strong gains last week has rebuild moderate technical support back into the market, which for now could be enough to maintain buyer momentum once traders move back to the focus on cattle complex and away from election coverage and outside market shifts that have overshadowed the markets over the last several days.

Trade in lean hog futures is desperately trying to find any sense of market support as traders continue to test support levels in nearby contracts, but limited gains in deferred contracts indicate that potential support may be just around the corner. Despite the higher close in all but spot month December contracts Tuesday, the triple-digit loss in pork cutout values continues to add underlying pressure to the complex. Few short-term changes are expected in either fundamental or technical factors, which could leave lean hog futures wandering in a narrow trading range near support levels over the next few days. The focus on potential export sales in Thursday's report will be closely monitored. A positive report could give the lean hog complex the spark it needs to draw limited but active buying back into the complex during early November. Cash hog prices are expected $1 lower to $1 higher with most bids expected steady to lower. Slaughter Wednesday is expected at 489,000 head. Saturday runs are expected at 272,000 head.

	BULL SIDE		BEAR SIDE
1)	Further support in boxed beef values Tuesday is stimulating additional fundamental support, with the expectations that firm product movement will continue through the end of the year.	1)	Feeder cattle futures continue to chip away at previous market gains seen last week. The steady pressure Monday and Tuesday may not move back to recent lows, but the inability for continued price gains may quickly box the market into a sideways trading range that could be maintained through much of 2020.
2)	Given the limited negotiated cash trade last week, packers are expected to need to become more aggressive over the next couple of days. Given expected elevated asking prices by feedlots, the potential to shift cash values higher remains strong.	2)	Lack of cash cattle price support by the end of the week is expected to cast significant concern about the ability to regain cash cattle support through the end of the year.
3)	Renewed underlying support is trickling into deferred lean hog futures. This is adding further market momentum as traders view the hog complex as oversold but carefully look for an opportunity to step back into the market.	3)	Pork cutout values posted strong losses Tuesday as concerns surrounding domestic and export pork demand develop, partially based on increased COVID-19 numbers and more active restrictions in many areas in order to combat the virus spread.
4)	Cash hog values have trickled higher during the week, creating limited optimism that packers are becoming more aggressive in sourcing hogs through the month of November.	4)	Spot December lean hog futures have moved below initial support levels of $66 per cwt. This moves the next support target at $62 per cwt set in late September. A move to or near these levels would likely stimulate widespread liquidation in what is already considered an oversold market structure.

#completecalfcare

Tuesday Closing Livestock Market Summary - Cattle Contracts Slip at the Day's Close

Tuesday's trade was mostly uneventful as the livestock contracts wondered higher, then lower and then closed mixed. Cattle contracts were optimistic as the day started, but as the closing bell drew near, the support whittled away. The lean hog market was just the opposite as contracts secured modest gains into closing. Hog prices closed higher on the National Direct Afternoon Hog Report, up $0.17 with a weighted average of $60.13 on 5,093 head. December corn is up 3 1/2 cents per bushel and December soybean meal is up $2.10. The Dow Jones Industrial Average is up 554.98 points and NASDAQ is up 202.96 points.

LIVE CATTLE:

The live cattle complex liked the notion of trading higher but didn't have the heart to close fully higher as nearby contracts dove lower before closing while deferred contracts kept their gains. December live cattle closed $0.72 lower at $107.82, February live cattle closed $0.22 lower at $110.30 and April live cattle closed $0.12 lower at $113.70. Tuesday's cash cattle trade was another dismal day without anything substantial transpiring. Feedlots are believed to price cattle around $110 this week but asking prices have yet to be shown. Tuesday's slaughter is estimated at 121,000 head, 4,000 head more than a week ago and 1,000 head more than a year ago.

Boxed beef prices close higher: choice up $0.79 ($209.44) and select up $2.83 ($195.45) with a movement of 151 loads (82.16 loads of choice, 38.03 loads of select, 16.97 loads of trim and 13.97 loads of ground beef).

WEDNESDAY'S CASH CATTLE CALL: Higher. As boxed beef prices are on the rise, feedlots are looking to this week's trade and gunning for higher prices after getting shorted last week. Trade may take longer to develop but could happen shortly after the Fed Cattle Exchange.

FEEDER CATTLE:

Feeder cattle contracts were trading in leery manner throughout Tuesday's trade, dancing on both sides of steady but ultimately closing lower. November feeders closed $0.85 lower at $136.12, January feeders closed $0.87 lower at $133.17 and March feeders closed $0.67 lower at $133.15. Monday's trade came close to closing alongside the 40-day moving average ($137.87), but the 100-day moving average is still far higher at $140.14 and Tuesday's close pushed the market further again from those averages. At OKC West Livestock Auction in El Reno, Oklahoma, compared to two weeks ago, steer calves traded $3.00 to $8.00 stronger and heifer calves sold anywhere from $8.00 to $12.00 higher with the biggest advancements seen on heifers weighing 500 to 600 pounds. Following last week's ice storm, the countryside is left muddy, but for the most part, producers are able to get trucks in and out and market their calves as they need. The CME feeder cattle index for Nov. 2: not available at this time.

LEAN HOGS:

The lean hog market saw modest support rally into Tuesday's end. Pork cutout values weren't able to close positively following the day's higher midday value, but the cash market did see some support from packers. December lean hogs closed $0.55 lower at $65.40, February lean hogs closed $0.22 higher at $65.52 and April lean hogs closed $0.20 higher at $68.17. Pork cutouts totaled 417.87 loads with 379.73 loads of pork cuts and 38.14 loads of trim. Pork cutout values: down $1.15, $82.99. Tuesday's slaughter is estimated at 493,000 head, 1,000 head more than a week ago and 3,000 head more than a year ago. The CME lean hog index for Oct. 30: down $1.01, $73.48.

WEDNESDAY'S CASH HOG CALL: Steady. With packers having ample supplies already committed, their participation in the cash market isn't expected to be much.

#completeherdhealth

Tuesday Midday Livestock Market Summary - Even with Election Pressure Contracts See Some Support

 General Comments

December live cattle are down $0.28 at $108.275, January feeder cattle are down $0.30 at $133.75, December lean hogs are down $0.15 at $65.8, December corn is up 3 cents per bushel and December soybean meal is up $1.90. The Dow Jones Industrial Average is up 577.00 points and NASDAQ is up 223.23 points. Heading into the afternoon hours, the livestock complex continues to trade mixed as live cattle contracts have gained support, lean hog contracts are trading mostly higher, but the feeder cattle market is veering lower. Back and forth trade behavior isn't unusual given the heightened emotion of this week.

LIVE CATTLE

Feedlots are grateful to the see the live cattle complex trading higher yet again despite outside pressures pinging on the marketplace. With boxed beef prices higher and packers having purchased significantly fewer cattle last week, feedlots are patiently waiting for the later part of this week to hopefully move the market higher. December live cattle are down $0.30 at $108.25, February live cattle are up $0.15 at $110.67 and April live cattle are up $0.12 at $113.95. Feedlots have yet to price cattle this week but rumors buzzing that cattle will be priced upwards of $110. There's been a light movement of cattle in Iowa, but not nearly enough to establish a trend for the week.

Boxed beef prices are higher: choice up $1.53 ($210.18) and select up $2.84 ($195.46) with a movement of 71 loads (40.59 loads of choice, 19.93 loads of select, 5.24 loads of trim and 5.21 loads of ground beef).

FEEDER CATTLE

Feeder cattle contracts have been motivated to trade higher in the last week but Tuesday's uncertainty has the complex shaken. November feeder cattle are up $0.02 at $137.00, January feeder cattle are down $0.15 at $133.92 and March feeders are down $0.12 at $133.70. With both the live cattle and lean hog markets trading higher, it wouldn't be unlikely to see the feeder cattle market warm up to the notion of trading higher as the day progresses. Part of the market's worry stems from rising corn prices as nearby corn contracts jump $0.02 to $0.03 per bushel.

LEAN HOGS

Strong resistance levels make it difficult for the complex to rally substantially but the lean hog market is seeking modest support throughout Tuesday's early trade. December lean hogs are down $0.37 at $65.57, February lean hogs are up $0.05 at $65.35 and April lean hogs are down $0.02 at $67.95. Helping spur the encouragement is the midday cutout value which jumped over $4.00 higher.

The projected lean hog index for 10/30/2020 is down $1.01 at $73.48, and the actual index for 10/29/2020 is down $1.00 at $74.49. Hog prices are lower on the National Direct Morning Hog Report, down $0.10 with a weighted average of $59.86, ranging from $56.00 to $60.01 on 3,838 head and a five-day rolling average of $61.15. Pork cutouts total 223.05 loads with 200.91 loads of pork cuts and 22.14 loads of trim. Pork cutout values: up $4.44, $88.58.

#completeherdhealth