Thursday Closing Livestock Market Summary - Support Builds for Live Cattle & Lean Hogs

Thursday did not disappoint the live cattle or lean hog markets as both were able to close higher and see gains throughout the retail sector. Meanwhile, the feeder cattle complex dipped lower upon seeing corn prices higher. Hog prices closed lower on the National Direct Afternoon Hog Report, down $0.29 with weighted average of $61.28 on 5,167 head. December corn is up 4 cents per bushel and December soybean meal is up $2.10. The Dow Jones Industrial Average is up 542.52 points and NASDAQ is up 300.15 points.

LIVE CATTLE:

Thursday's market was favorable to feedlots again as boxed beef prices scaled higher, slaughter continues to speed along at a quick rate and cash cattle prices traded better than last week. December live cattle closed $0.47 higher at $108.35, February live cattle closed $0.67 higher at $111.45 and April live cattle closed $0.62 higher at $115.30. There was a modest movement of cattle in the Northern Plains Thursday afternoon for mostly $107 live and $167 dressed. Thursday's live cattle traded $1.00 stronger than a week ago and the North's dressed trade was roughly $4.00 higher than a week ago. Thursday's slaughter is estimated at 120,000 head, 10,000 head more than a week ago and steady with a year ago.

Beef net sales of 20,400 mt reported for 2020 were up 8% from the previous week and 9% from the prior four-week average. The three primary increases were from Japan (4,700 mt, including decreases of 400 mt), South Korea (4,600 mt, including decreases of 700 mt) and China (3,600 mt, including decreases of 100 mt).

Thursday's actual slaughter data shared depressing news for cattlemen. For the week ending Oct. 23, actual slaughter totaled 644,853 head, down slightly from the previous week. Steer carcass weights chimed in at an all time high, jumping to 931 pounds, up 2 pounds from the previous week and heifer carcass weights declined 3 pounds to 847 pounds on average.

Boxed beef prices closed higher: choice up $2.36 ($212.55) and select up $1.92 ($198.97) with a movement of 149 loads (96.26 loads of choice, 31.84 loads of select, 6.28 loads of trim and 15.10 loads of ground beef).

FRIDAY'S CASH CATTLE CALL: Steady. Seeing that both the Northern and Southern Plains have been able to successfully move cattle this week, Friday's trade will most likely stay within the already tested prices of this week.

FEEDER CATTLE:

Rallying corn prices put the feeder cattle market's rally on hold as the corn market closed $0.03 to $0.04 higher in nearby contracts. Even though this week's cash cattle trade and live cattle contracts are trading higher, the worry about rising feed costs is enough to slow the feeder cattle complex in its tracks and wane the market's rally. November feeder cattle closed $0.12 lower at $137.57, January feeder cattle closed $0.25 higher at $135.40 and March feeders closed $0.12 lower at $134.75. At Winter Livestock in Pratt, Kansas compared to a week ago feeder steers weighing 700 to 800 pounds sold $3.00 to $6.00 higher. Feeder steers weighing 800 to 900 pounds sold $2.00 lower while steers weighing over 900 pounds sold unevenly steady. Feeder heifers weighing 600 to 800 pounds sold $2.00 to $4.00 higher, heifers weighing 800 to 900 pounds sold steady to $1.00 lower and heifers weighing 950 to 1,050 pounds sold $5.00 to $7.00 higher. The CME feeder cattle index for Nov. 4: down $0.66, $137.91.

LEAN HOGS:

The lean hog market saw Thursday's trade as a wide opportunity as the board scaled as much as $1.47 stronger in nearby contracts and the day's closing cutout value was able to close considerably stronger. December lean hogs closed $1.07 higher at $67.42, February lean hogs closed $1.47 higher at $68.47 and April lean hogs closed $1.12 higher at $70.52. Pork cutouts totaled 266.32 loads with 218.67 loads of pork cuts and 47.66 loads of trim. Pork cutout values: up $3.97, $86.38. Thursday's slaughter is estimated at 490,000 head, 7,000 head more than a week ago and 5,000 head less than a year ago. The CME lean hog index for Nov. 3: down $0.83, $72.05.

Pork net sales of 42,200 mt reported for 2020 were up 46% from the previous week and 18% from the prior four-week average. The three primary increases were from Mexico (14,700 mt, including decreases of 700 mt), China (10,300 mt, including decreases of 1,400 mt) and South Korea (5,100 mt, including decreases of 100 mt).

Thursday's actual slaughter data shared bad news for the hog industry as well. For the week ending Oct. 24, slaughter was down slightly from the week before totaling 2,676,056 head and weights were heavier. Live weights averaged 292 pounds (up 2 pounds) and dressed weights averaged 217 pounds (up 1 pound).

FRIDAY'S CASH HOG CALL: Steady to slightly lower. Packers don't seem to be overly concerned about buying more hogs to keep up with their swift slaughter pace. As the weekend nears, packers will probably participate mildly but not dive into the market enough to boost prices.

#completecalfcare

Thursday Midday Livestock Market Summary - Live Cattle and Lean Hogs Jump Higher

 General Comments

Rallying corn prices are hindering the feeder cattle market's ability to rally alongside the rest of the livestock contracts. Both live cattle and lean hog contracts are trading fully higher into Thursday's afternoon and the cash cattle market is seeing packer interest improve. December corn is up 4 3/4 cents per bushel and December soybean meal is up $3.30. The Dow Jones Industrial Average is up 398.78 points and NASDAQ is up 237.66 points.

LIVE CATTLE

The live cattle complex is sitting in a fine position for feedlots to push on the cash cattle market. Following last week's disappoint trade, feedlots are anxious to move this week's cash cattle market higher and make up for some lost ground. With boxed beef prices printing higher and the futures market trading higher throughout the week, trade later Thursday afternoon or into Friday could be rewarding to feedlots. December live cattle are up $0.22 at $108.10, February live cattle are up $0.42 at $111.20 and April live cattle are up $0.45 at $115.12. Packer inquiry is growing as bids of $107 are offered in Kansas, Colorado and Nebraska, and dressed cattle are bid on in Nebraska at $167.

Beef net sales of 20,400 mt reported for 2020 were up 8% from the previous week and 9% from the prior four-week average. The three primary increases were from Japan (4,700 mt, including decreases of 400 mt), South Korea (4,600 mt, including decreases of 700 mt) and China (3,600 mt, including decreases of 100 mt).

Boxed beef prices are higher: choice up $1.31 ($211.50) and select up $3.34 ($200.39) with a movement of 74 loads (44.63 loads of choice, 16.60 loads of select, 3.16 loads of trim and 9.62 loads of ground beef).

FEEDER CATTLE

As corn prices rally again $0.03 to $0.05 higher in nearby contracts, the feeder cattle market faces some opposition in the day's quest to trade higher along side the rest of the livestock marketplace. November feeders are down $0.10 at $137.60, January feeders are up $0.17 at $135.32 and March feeders are down $0.20 at $134.67. Watching sale barn reports this week has been interesting as sale receipts are lighter even though the market has been trading mostly higher and good shipping weather prevails.

LEAN HOGS

Thursday's export report wasn't a big market mover as the market was hopeful to see China more aggressive, but its stronger movement did give the futures market some gusto to rally modestly upon. December lean hogs are up $0.52 at $66.85, February lean hogs are up $0.77 at $67.77 and April lean hogs are up $0.65 at $70.05. Pork cutout values have been etching lower but Thursday's midday report is up substantially and may even trick into the day's closing report.

Pork net sales of 42,200 mt reported for 2020 were up 46% from the previous week and 18% from the prior four-week average. The three primary increases were from Mexico (14,700 mt, including decreases of 700 mt), China (10,300 mt, including decreases of 1,400 mt) and South Korea (5,100 mt, including decreases of 100 mt).

The projected lean hog index for 11/4/2020 is down $0.53 at $71.52, and the actual index for 11/3/2020 is down $0.83 at $72.05. Hog prices on the National Direct Morning Hog Report are unavailable due to confidentially. Pork cutouts total 148.53 loads with 119.44 loads of pork cuts and 29.09 loads of trim. Pork cutout values: up $8.59, $91.00.

#completecalfcare

Thursday Morning Livestock Market Summary - Buyer Interest Seeping Back Into Complex

 General Comments:

Following light cash cattle trade Wednesday in several areas, the focus will return to the ability for feeders to leverage higher futures prices and rising boxed beef values into higher cash cattle trade through the rest of the week. Limited trade has developed at $106 to $107 per cwt live basis Wednesday. Although this is not likely enough to establish an overall tone for the week, the amount of trade is a good indication of where trade is heading. Current trade is steady to $1 per cwt higher last week. Although the support is welcomed, the inability to push for further price support at the end of the week still remains a disappointment given the active gains in futures trade in the last week and a half, as well as a firm upward trend in beef cutout values. It is still uncertain just how many cattle packers are willing to buy this week. Even though trade totals were light last week, the potential is that packers may remain content with limited cash buying over the near future, creating a stark difference from activity levels and buying interest seen during most of October. Strong market gains, Wednesday has not only offset early week losses, but the triple-digit gains in feeder cattle futures have quickly moved through initial resistance levels of $137.40 in December futures set last week. The ability to sustain prices above his level through the end of the week is likely to spark renewed underlying support in nearby and deferred feeder cattle trade, sparking follow-through gains across live cattle trade also. Steady but firm market moves during the first half of November would go a long way in drawing additional commercial support back to the cattle complex, helping to establish a bullish market shift through the end of the year.

Active gains in lean hog futures midweek is setting the tone for additional underlying support developing in late week trade. Initial trade is likely to break away from recent market moves and the direction of pork values, with traders putting increased focus on the weekly Export Sales report, which will be released before the markets open on Thursday. Traders are looking for moderate-to-firm new sales to China as well as other Asian nations, which will give a better indication of the ability to move pork into these areas through the fourth quarter of the year. If overall sales and shipments are seen as disappointing Thursday morning, limited-to-moderate price pressure is very likely, at least early in the session. But traders continue to focus on domestic demand potential through the end of the year as packers continue to aggressively move through the large number of market-ready hogs available to them over the next couple of months. This may further limit the upside potential of lean hog trade, although recent support in cash hog values indicate that further potential gains may test short-term resistance levels in the coming days. Cash hog prices are expected $1 lower to $1 higher with most bids expected steady to firm. Slaughter Thursday is expected at 490,000 head. Saturday runs are expected at 278,000 head.

	BULL SIDE		BEAR SIDE
1)	Feeder cattle futures have continued to shift higher. Spot November futures have rallied $8 over the last two weeks, quickly establishing seasonal lows and quickly moving through resistance levels as buyers are actively moving back into the complex.	1)	Negotiated cash cattle prices have continued to lose ground on formula-traded cattle over the last three weeks. This is creating significant concerns about the ability to regain cash market support and sustain active trade volumes through the upcoming weeks.
2)	Boxed beef values have moved steadily but firmly higher over the last week. The ability to regain previous support in beef prices is likely to stimulate additional longer-term strength in both cash and futures trade.	2)	Live cattle futures have continued to lag in the support seen in feeder cattle trade during early November. This is likely to create additional underlying pressure through the entire live cattle complex as questions remain about the ability to sustain or grow beef demand through the end of the year.
3)	Strong triple-digit gains in lean hog futures, which developed Wednesday is focusing on the ability to spark renewed commercial buyer interest through the entire complex. This change in open interest is likely to lead to longer-term market support in the upcoming days and weeks.	3)	Despite the support in futures and cash hog values, pork cutout values are still unable to show buyer support. This lack of stability could lead to underlying price pressure through the end of the week.
4)	Traders are closely watching the morning export sales report, looking for increased sales and shipments to China. Active sales last week is likely to spark renewed underlying support in nearby lean hog contracts during morning trade.	4)	Active market-ready hog numbers continue to create a need to keep procurement levels active not only in the short term, but over the next several weeks. Any hiccup in plant processing speeds due to the inability to keep plant workers healthy and engaged, creates concerns of quickly backing up the pork system once again, like seen earlier in the year.

#completecalfcare

Wednesday Closing Livestock Market Summary - Contracts Close With Full Support

The livestock complex closed fully higher Wednesday afternoon as support continued to grow and develop throughout the day. Cattle contracts were leery at the beginning of the day but ultimately closed stronger alongside the hog market. Hog prices closed higher on the National Direct Afternoon Hog Report, up $1.49 with a weighted average of $61.28 on 10,095 head. December corn closed up 4 1/4 cents per bushel, and December soybean meal was up $8.50. The Dow Jones Industrial Average was up 367.63 points, and NASDAQ was up 430.21 points.

LIVE CATTLE:

The live cattle market turned to trading fully higher after the noon hour, and the market's confidence spurred the cash cattle market into testing the week's trade. December live cattle closed $0.05 higher at $107.87, February live cattle closed $0.47 higher at $110.77 and April live cattle closed $0.97 higher at $114.67. The live cattle market's biggest advocate has been the change in boxed beef prices as of late. As the boxed beef market scales higher, packers are willing to pay more for cattle and hopefully are enticed to keep slaughter at a swift progression. Wednesday's cash cattle market saw the biggest trade happen in Kansas where cattle sold for $106 to $107 -- steady to $1.00 higher than a week ago. The rest of the countryside's trade was limited, but Nebraska sold a handful of cattle for $106, Texas sold some cattle for $107 and Iowa sold very few cattle for $163 to $164. Wednesday's slaughter is estimated at 119,000 head -- 1,000 head more than a week ago and 1,000 head fewer than a year ago.

Boxed beef prices closed higher: choice up $0.75 ($210.19) and select up $1.60 ($197.05) with a movement of 166 loads (110.97 loads of choice, 16.53 loads of select, 18.27 loads of trim and 20.27 loads of ground beef).

THURSDAY'S CASH CATTLE CALL: Steady to somewhat higher. With the strength that's building in the live cattle market, there's room for feedlots to push the market another $1.00 stronger. But with cattle already being sold this week and packers seeing that they can get feedlots pushed into selling for only steady to $1.00 higher, it makes it tough for other feedlots to up the ante.

FEEDER CATTLE:

Even with a $0.04 to $0.05 rally in the corn market, the feeder cattle contracts prevailed through Wednesday's close and secured gains over $1.57 in nearby contracts. November feeder cattle closed $1.57 higher at $137.70, January feeder cattle closed $1.97 higher at $135.15 and March feeders closed $1.72 higher at $134.87. Traders seemed more willing to dive into Wednesday's market after the noon hour, at which point both live cattle contracts and especially the feeder cattle market saw a considerable jump in support. At Ozarks Regional Stockyards in West Plains, Missouri, compared to a week ago, steers and heifers sold $2.00 to $14.00 higher with excellent demand and a moderate supply. There were some fancy lots that brought exceptional demand with strong genetic lines, a vaccination program and that were long weaned. The CME feeder cattle index 11/3/2020: up $0.54, $138.57.

LEAN HOGS:

Wednesday's lean hog market traded consistently throughout the day, rallying modestly in most of the complex and upward of $1.00 stronger in some of the deferred contracts. December lean hogs closed $0.95 higher at $66.35, February lean hogs closed $1.47 higher at $67.00 and April lean hogs closed $1.22 higher at $69.40. The market's gains weren't only seen throughout the futures market but also in the cash market as packers upped their bids and bought right at 10,000 head. Pork cutout values continue to trend lower, but Wednesday's regression wasn't so steep that it undermined the rally on the board nor the cash market. Pork cutouts total 375.74 loads with 321.58 loads of pork cuts and 54.16 loads of trim. Pork cutout values: down $0.58, $82.41. Wednesday's slaughter is estimated at 489,000 head - 4,000 head more than a week ago and 4,000 head less than a year ago. The CME lean hog index 11/2/2020: down $0.60, $72.88.

THURSDAY'S CASH HOG CALL: Steady. The cash hog market is likely to trade steady as pork cutout values continue to be pressured. If Thursday's export report is fruitful for the market, packers may be prompted into buying more hogs and pushing the market slightly higher.

#completeherdhealth