Wednesday Midday Livestock Market Summary - Cattle Advance While Hogs Retreat

GENERAL COMMENTS:

While the cattle contracts leap into action, the lean hog complex is back to trading lower as traders see mixed support from both the cash hog market and pork cutout values. The cash cattle market remains quiet with no business having developed at this point. December corn is down 1/2 cent per bushel and December soybean meal is up $2.40. The Dow Jones Industrial Average is down 224.14 points.

LIVE CATTLE:

The live cattle complex has caught the attention of traders as they're willingly advancing the nearby contracts by more than a $1.00 and are continuing to support the deferred contracts modestly. So long as beef demand continues to show relatively strong support this week, there's a strong chance that traders continue to support the contracts ahead of seeing what the week's cash cattle trade pans out to be. No cash cattle trade has been reported at this point, and it's likely that trade is delayed for at least another day. Asking prices in the South are noted at $180 plus but asking prices in the North remain elusive. October live cattle are up $1.67 at $181.62, December live cattle are up $1.52 at $185.67 and February live cattle are up $1.25 at $189.72.

Boxed beef prices are mixed: choice up $0.14 ($315.62) and select down $0.16 ($289.38) with a movement of 72 loads (32.39 loads of choice, 15.62 loads of select, 5.97 loads of trim and 18.41 loads of ground beef).

FEEDER CATTLE:

As corn prices trade mostly steady, the feeder cattle complex is rallying off the momentum of continued strong feeder cattle sales in the countryside and off the momentum of the live cattle complex's higher trend. September feeders are up $1.12 at $252.50, October feeders are up $1.37 at $255.67 and November feeders are up $1.22 at $257.42. As long as we continue seeing steady corn prices and higher prices across the live cattle contracts, the feeder cattle complex should have not any problem closing higher Wednesday afternoon.

LEAN HOGS:

While the cattle complex trades higher, the lean hog contracts are back to drifting lower as traders want to see more fundamental support before they advance the contracts anymore. Pork cutout values have been relatively supportive as of late, but the cash hog market continues to be a problem with little trade developing. October lean hogs are down $1.37 at $81.80, December lean hogs are down $0.87 at $74.20 and February lean hogs are down $0.52 at $78.32.

The projected lean hog index for Sept. 5 is down $0.55 at $86.01, and the actual index for Sept. 1 is down $1.21 at $86.56. Hog prices are lower on the Daily Direct Morning Hog Report, down $0.30 with a weighted average price of $79.09, ranging from $77.00 to $80.00 on 740 head and a five-day rolling average of $79.85. Pork cutouts total 187.41 loads with 161.80 loads of pork cuts and 25.61 loads of trim. Pork cutout values: up $0.05, $98.92.

Wednesday Morning Livestock Market Update - Futures Expected to Remain Choppy

GENERAL COMMENTS:

Cattle just could not find any solid direction, trading in about a $2.00 range, but settling near the close of Friday. Feedlots have hopes for higher cash, but they have also been holding over cattle and holding out until late in the week to no avail. The general idea of the trade this week is for no better than steady cash. Boxed beef was mixed with choice up $0.99 and select down $0.75. Cattle supplies have not increased and will remain tight for some time, but it will be up to demand to move prices higher. Concern over rising inflation again is surfacing, which is certainly not what we want to see for maintaining strong beef demand.

Hog traders did not have a cash price to provide direction as it was not released due to packer submission issues. This left traders with uncertainty over packer interest. The solid support for the day came from cutouts increasing $5.17, but that provided little support to futures. The erratic nature of cutouts leaves cash more of the support needed to provide direction. Packers should be aggressive in the cash market as they want to make up for the holiday with increased slaughter, likely looking for a large slaughter Saturday. They will need to step up and purchase more aggressively.

	BULL SIDE		BEAR SIDE
1)	Cattle futures have been able to hold at higher prices without any major price retracements. Fund traders are long the market and are comfortable holding those positions.	1)	Cattle futures have not been able to find solid support and trend higher. The market may have reached a plateau, which may be difficult to break out of.
2)	Cattle supplies are not becoming more plentiful and will remain tight for some time to come.	2)	The concern over the potential for increased inflation may keep beef price potential limited as consumers continue to face higher food prices.
3)	Cutouts jumped Tuesday, indicating there had been strong pork movement over the holiday weekend.	3)	Hog supplies are plentiful and packers have not had to be aggressive with cash. Cutouts have been erratic, leaving traders uncertain.
4)	Packers may need to be more aggressive this week to procure the hogs they need to maintain slaughter pace.	4)	Hog futures closing near the lows Tuesday may indicate futures may have a difficult time holding gains as traders are quick to take profits when they have some. Traders are scalping the market rather than establishing long-term positions.

Tuesday Closing Livestock Market Update - Mixed Tones Take Over the Complex

GENERAL COMMENTS:

It was a mixed day for the livestock complex as early on the contracts traded fully higher, but by Tuesday's close the market's tone was dominated by mixed emotions. No cash cattle trade developed throughout the day, and bids and asking prices are still elusive. Hog prices averaged $78.19 on the Daily Direct Afternoon Hog Report, ranging from $72.00 to $80.00 on 1,794 head. December corn is up 4 1/2 cents per bushel and December soybean meal is down $2.00. The Dow Jones Industrial Average is down 164.40 points.

LIVE CATTLE:

The live cattle complex rounded out the day mostly higher although its nearby contracts (October and December) did close lower. The market slid into a sideways trading range last week and without seeing how this week's cash cattle market is going to pan out, traders elected to play it safe in the nearby contracts while they left the deferred months to continue to trade higher on the market's strong fundamental outlook. October live cattle closed $0.20 lower at $179.95, December live cattle closed $0.02 lower at $184.15 and February live cattle closed $0.15 higher at $188.47. New showlists appear to be mixed, higher in Texas, somewhat lower in Nebraska/Colorado and lower in Kansas. Tuesday's slaughter is estimated at 128,000 head - 3,000 head more than a week ago and 1,000 head more than a year ago. Monday's slaughter is estimated at 3,000 head. No bids or asking prices are available at this point.

Last week, Northern dressed cattle traded from $288 to $295, but mostly at $290, which is $3.00 lower than the previous week. Southern live cattle traded at mostly $178 to $179, which is mostly steady to $1.00 lower than the previous week's weighted average. Last week's negotiated cash cattle trade totaled 68,750 head. Of that, 65% (44,538 head) were committed to the nearby delivery, while the remaining 35% (24,212 head) were committed to the deferred delivery.

Boxed beef prices closed mixed: choice up $0.99 ($315.48) and select down $0.75 ($289.54) with a movement of 109 loads (68.58 loads of choice, 28.04 loads of select, zero loads of trim and 11.92 loads of ground beef).

WEDNESDAY'S CATTLE CALL: Steady. The saga of mostly steady cash prices is likely to continue this week as feedlots desire more money and packers want to keep their expenses as minimal as possible.

FEEDER CATTLE:

The feeder cattle complex grew skeptical of closing out the day fully higher, so the nearby contracts drew back while the market's deferred contracts kept with their rallying nature through the day's end. The combination of seeing some of the live cattle contracts close lower amid slightly higher tones in the corn complex ultimately was the reason behind why the nearby contracts ended the day slightly lower. Even so, the market still has its strong underlying tone as fundamental demand is excellent and with some parts of the country receiving more moisture and a break from the heat, feeders could see even more demand in the nearing weeks. September feeders closed $0.47 lower at $251.37, October feeders closed $0.35 lower at $254.30 and November feeders closed $0.17 lower at $256.20. The CME feeder cattle index 9/4/2023: up $0.93, $247.81.

LEAN HOGS:

The lean hog complex closed mostly lower although the market's spot October contract and nearby December contracts were able to keep their elevated position while the rest of the contracts drifted slightly lower. Even though the belly continues to be a wild, sporadic cut that swings the carcass price drastically, it helped prices close higher this afternoon. The belly closed $54.51 higher, and then was followed by less dramatic gains as the rib gained $5.41 and the ham closed $2.31 higher. The loin, butt and picnic all saw gains over $1.00 as well -- so all in all, even though the belly was the carcass price's biggest drive, pork demand was evident in this afternoon's close. October lean hogs closed $0.12 higher at $83.17, December lean hogs closed $0.47 higher at $75.07 and February lean hogs closed $0.17 lower at $78.85. Pork cutouts total 285.79 loads with 257.67 loads of pork cuts and 28.11 loads of trim. Pork cutout values: up $11.13, $104.83. Tuesday's slaughter is estimated at 482,000 head - 6,000 head more than a week ago and 5,000 head less than a year ago. Monday's slaughter is estimated at 2,000 head. The CME lean hog index 8/31/2023: down $1.49, $87.77.

WEDNESDAY'S HOG CALL: Slightly higher. Packers have been careful not to overbuy or overspend in the cash hog market, but given that pork demand is seeing some support, cash prices could be higher this Wednesday.

Tuesday Midday Livestock Market Summary - Traders Jump Into Action and Support Complex

GENERAL COMMENTS:

The livestock complex is trending mostly higher into Tuesday's noon hour as traders are anxious to get back to work after the long weekend. No cash cattle trade has developed yet and it's likely that trade is delayed until Wednesday or later. December corn is up 2 3/4 cents per bushel and December soybean meal is down $2.00. The Dow Jones Industrial Average is down 57.30 points.

LIVE CATTLE:

With boxed beef prices considerably higher at Tuesday's noon hour, the live cattle contracts have unanimously agreed that the market's direction should be higher early this week. October live cattle are up $0.52 at $180.65, December live cattle are up $0.67 at $184.85 and February live cattle are up $0.70 at $189.02. The market settled into a mostly sideways trading range last week as cash cattle prices traded steady to $3.00 lower across both regions. Traders are seeing Tuesday's stronger beef prices as an excellent support signal but will again look to the market's cash cattle trade for direction later this week. No bids or asking prices are available at this point, and trade isn't expected to develop until Wednesday or later. New showlists appear to be mixed, higher in Texas, somewhat lower in Nebraska/Colorado and lower in Kansas.

Last week, Northern dressed cattle traded from $288 to $295, but mostly at $290, which is $3.00 lower than the previous week. Southern live cattle traded at mostly $178 to $179, which is mostly steady to $1.00 lower than the previous week's weighted average.

Boxed beef prices are higher: choice up $3.42 ($317.91) and select up $1.92 ($292.21) with a movement of 45 loads (24.67 loads of choice, 10.73 loads of select, zero loads of trim and 9.11 loads of ground beef).

FEEDER CATTLE:

Even though the nearby corn contracts are trending $0.03 to $0.04 higher into Tuesday's noon hour, the feeder cattle contracts are seeing the support in the live cattle market as enough positivity in the complex to safely trade the contracts higher. September feeders are down $0.45 at $251.40, October feeders are up $0.12 at $254.77 and November feeders are up $0.27 at $256.65. Over the next couple of weeks, sale barn receipts will likely be thin, but toward the later part of September, the fall run may gain momenum and we see more active trading. It will be especially interesting this week to see what the fall run amounts to given that feeders and calves have been marketed earlier this year than compared to historical trends.

LEAN HOGS:

The lean hog complex is again rallying as traders note the continued support of consumers in pork cutout values. The cash market is still only being vaguely participated in, but maybe later this week the market will see a little more support. October lean hogs are up $0.40 at $83.45, December lean hogs are up $0.82 at $75.42 and February lean hogs are up $0.32 at $79.35. The carcass price was heavily influenced this morning by a $17.83 jump in the belly, but the rib was also up $5.10 and the ham up $3.59.

The projected lean hog index for Sept. 1 is down $1.21 at $86.56, and the actual index for Aug. 31 is down $1.49 at $87.77. Hog prices on the Daily Direct Morning Hog Report average $79.39, ranging from $72.00 to $80.00 on 478 head and a five-day rolling average of $80.30. Pork cutouts total 127.69 loads with 112.61 loads of pork cuts and 15.09 loads of trim. Pork cutout values: up $4.59, $98.29.