Monday Midday Livestock Market Summary - Cattle Continue to Press Higher

GENERAL COMMENTS:

The livestock complex is again trading mixed as the cattle sector is met with ample support, but the lean hog market continues to venture lower and lower. It will be especially interesting to see what the cash cattle market pans out this week as packers will be reluctant to pay more money on top of last week's steep advancement, but if they're still short bought, they could be forced into paying whatever feedlot managers ask. March corn is up 7 1/4 cents per bushel and March soybean meal is up $0.50. The Dow Jones Industrial Average is up 290.43 points.

LIVE CATTLE:

The live cattle complex is continuing to grind higher and higher as the market is flooded with ample support. Between last week's higher charge in the cash cattle market, combined with the continued support of strong beef, demand already this week -- the market is seeming confident in its continuation of a higher trend. February live cattle are up $1.15 at $195.20, April live cattle are up $1.10 at $197.10 and June live cattle are up $1.10 at $191.77. It will be especially interesting to see how the dynamics of this week's cash cattle market pan out as packers will loathe the idea of paying more money for cattle yet again, but on the same hand, it seems as though they're short bought which would somewhat force them into paying up again this week.

Last week Southern live cattle traded at mostly $196 to $197, which is $4.00 to $5.00 higher than the previous week, and Northern dressed cattle traded at mostly $312 to $315 which is $5.00 to $8.00 higher than the previous week's weighted average.

Boxed beef prices are higher: choice up $2.00 ($327.24) and select up $4.40 ($301.12) with a movement of 57 loads (21.36 loads of choice, 21.95 loads of select, 3.41 loads of trim and 10.13 loads of ground beef).

FEEDER CATTLE:

Although the feeder cattle complex may have closed mostly lower Friday afternoon, the market has jumped back into gear Monday morning as higher tones summarize the market's theme Monday morning. January feeders are up $1.60 at $266.42, March feeders are up $1.60 at $265.77 and April feeders are up $1.75 at $266.15. It's likely that strong feeder cattle demand is again the market's tone this week in sale barns across the country as buyers have order to fill following the long holiday break.

LEAN HOGS:

The cattle complex may be frolicking higher as support is ample, but the lean hog complex can't seem to gain footing in the marketplace no matter where it looks. With traders skeptical of consumer demand, and again Monday morning seeing lower pork cutout values, it's no wonder why the market is yet again trailing lower. February lean hogs are down $1.12 at $79.67, April lean hogs are down $0.37 at $85.42 and June lean hogs are down $0.07 at $98.42.

The projected lean hog index for 1/3/2024 is down $1.11 at $82.01 and the actual index for 1/2/2024 is down $0.87 at $83.12. Hog prices are lower on the Daily Direct Morning Hog Report, down $1.37 with a weighted average price of $78.32, ranging from $68.00 to $79.00 on 433 head and a five-day rolling average of $79.57. Pork cutouts total 244.61 loads with 207.57 loads of pork cuts and 37.04 loads of trim. Pork cutout values: down $1.57, $87.97.

Monday Morning Livestock Market Update -

GENERAL COMMENTS:

Live cattle were on fire last week with futures pushing to new contract highs and cash prices jumping significantly. Southern live cattle sold for $2.00 to $5.00 higher with Northern dressed cattle ranging from $6.00 to $8.00 higher. The packers were short-bought and feedlots held out. It is difficult to believe this could be repeated this week, but anything is possible. Eventually, the market will find a level where demand will slow and prices will retrace. Boxed beef continued to increase with choice up $1.76 and select up $2.49. Feeder cattle remain in strong demand with buyers aggressive at auctions with prices generally $10.00 higher in most categories recently. The Commitments of Traders report will be released today, delayed due to the holiday.

Hogs struggled last week. It is uncertain whether some of the losses were due to end-of-the-year positioning and lighter trading activity or if the fundamentals were the driving force. It likely was a combination of both. The weakness has damaged the charts significantly and may be difficult to recover from. The weakness of cash and cutouts last week points to reduced demand and a further concern for price strength. It would seem logical that pork demand should improve due to the high beef prices as consumers continue to face higher food prices. The National Daily Direct Afternoon Hog report on Friday showed cash down $0.49. Pork cutouts gained $0.22. Cutouts need to see continued price increases to generate aggressive buying by traders and regain the losses realized over the past two weeks.

	BULL SIDE		BEAR SIDE
1)	There is no sign of beef demand slowing or feeder cattle prices dropping anytime soon.	1)	High prices cure high prices and cattle are moving closer to that level where demand will be impacted. That has already been seen with international demand.
2)	Feedlots have been in control and holding for higher prices. This will continue as packers need cattle and the feedlots are not pressed to move cattle.	2)	The Commitments of Traders report will be released today and is likely to show a record-long managed money position in live cattle. That usually does not last very long before liquidation is triggered.
3)	Hog futures may have been impacted more by the holiday season trading activity and, now that it is over, traders might view the current price as a buying opportunity.	3)	Cash hogs and cutouts have not been able to find solid support. The weakness keeps pressure on the market.
4)	Hog slaughter pace remains strong as packers need to satisfy demand. This keeps the hog supply from backing up.	4)	Hog supply remains sufficient for demand with packers not needing to be aggressive purchasers, even though the slaughter pace remains strong.

Friday Closing Livestock Market Update - Futures Market Retreat

GENERAL COMMENTS:

Even though the cattle complex's rally fizzled out by the day's close, the market still performed exceptionally well throughout the week. This week Southern live cattle were marked anywhere from $195 to $197, which is $2.00 to $5.00 higher than a week ago, and Northern dressed cattle traded for mostly $315 which is $8.00 higher than a week ago. March corn is down 8 3/4 cents per bushel and March soybean meal is down $11.30. The Dow Jones Industrial Average is up 339.86 points.

From Friday to Friday livestock futures scored the following changes: February live cattle up $3.40, April live cattle up $2.65; January feeder cattle up $3.45, March feeder cattle up $3.63; February lean hogs down $3.38, April lean hogs down $3.75; March corn down $0.03, May corn down $0.03.

Friday's export report shared that beef net sales of 1,400 mt for 2024 were up 29% from the previous week but down 71% from the prior 4-week average. The three largest buyers were Japan (1,300 mt), China (400 mt), and Italy (100 mt). Pork net sales of 7,500 mt for 2024 were up 6% from the previous week but down 60% from the prior 4-week average. The three largest buyers were Mexico (8,500 mt), Japan (600 mt) and Dominican Republic (400 mt).

LIVE CATTLE:

The only contract that could close fully higher by Friday's end was the spot February contract, but that's not to belittle what the market accomplished throughout the week. Traders aggressively supported the live cattle contracts throughout the week, and thankfully their dedication and interest in the sector was complimented by the cash cattle market's higher trade late in the week. February live cattle closed $0.45 higher at $194.05, April live cattle closed $0.05 lower at $196.00 and June live cattle closed $0.67 lower at $190.67. Throughout the week dressed cattle sold for $315 which is $8.00 higher than last week's weighted average, and live cattle sold anywhere from $195 to $197, which is $2.00 to $5.00 higher than last week's weighted average. The dressed cattle sales of $315 are a new record for the fed cash cattle market, and so is the live price of $197. 

Friday's slaughter is estimated at 121,000 head -- 2,000 head less than a week ago and 3,000 head less than a year ago. Saturday's slaughter is projected to be around 27,000 head. The week's total slaughter is estimated at 498,000 head -- 64,000 head more than a week ago and 44,000 head less than a year ago.

Boxed beef prices closed higher: choice up $1.76 ($325.24) and select up $2.49 ($296.72) with a movement of 149 loads (95.99 loads of choice, 15.58 loads of select, 20.07 loads of trim and 17.04 loads of ground beef).

MONDAY'S CATTLE CALL: Steady/somewhat higher. It's tough to say exactly what next week's market will do without knowing how many cattle packers got bought this past week. If they were about to buy up some supply, then they may be able to hold prices steady next week. But if they are still short bought, prices will trade higher.

FEEDER CATTLE:

The feeder cattle complex also walked its contracts backward ahead of Friday's close, but just like the live cattle complex, that's not to say that the market wasn't aggressive and well supported this past week as most of the nearby contracts scored new contract highs. January feeders closed $1.65 lower at $264.82, March feeders closed $2.02 lower at $264.17 and April feeders closed $2.12 lower at $264.40. At Mitchell Livestock Auction in Mitchell, South Dakota compared to their last sale two weeks ago, feeder steers under 700 pounds sold $10.00 to $15.00 higher, and there were instances where those cattle sold as much as $20.00 higher. Steers weighing over 700 pounds sold $5.00 to $10.00 higher. Heifers traded mostly $10.00 to $15.00 stronger with instances up to $20.00 higher. The sale report did note that the market was very active on the big feedyard bound cattle but was even more active on the lighter weight cattle as they are harder to come by at this point in time. Feeder cattle supply over 600 pounds was 88%. The CME feeder cattle index 1/2/2025: up $3.99, $265.76.

LEAN HOGS:

The lean hog complex kept with its lower trending tone through Friday's close as the market simply lacked adequate support. Traders were skeptical of supporting the complex throughout the week as demand has been lacking. And while today's midday and afternoon pork cutout reports did close higher, traders are going to need to see more long-term support before they'll feel reassured. February lean hogs closed $0.37 lower at $80.77, April lean hogs closed $0.77 lower at $85.77 and June lean hogs closed $0.92 lower at $98.50. Hog prices closed lower on the Daily Direct Afternoon Hog Report, down $0.49 with a weighted average price of $79.59 on 4,938 head. Pork cutouts totaled 333.99 loads with 294.68 loads of pork cuts and 39.31 loads of trim. Pork cutout values: up $0.22, $89.54. Friday's slaughter is estimated at 488,000 head -- 1,000 head more than a week ago and 2,000 head more than a year ago. Saturday's slaughter is projected to be around 419,000 head. The CME lean hog index 12/31/2024: down $0.28, $83.99.

MONDAY'S HOG CALL: Lower. Packers rarely buy enough hogs on Monday to advance the market.

Friday Midday Livestock Market Update - Fed Cash Cattle Prices Reach $315 Dressed & $197 Live

GENERAL COMMENTS:

It's been an eventful morning for the cattle complex as the fed cash cattle market is seeing prices develop substantially higher as dressed cattle have begun to be reported at $315 and Southern cattle are being reported at $197 -- both are new all-time market highs. March corn is down 9 cents per bushel and March soybean meal is down $12.10. The Dow Jones Industrial Average is up 241.83 points.

Friday's export report shared that beef net sales of 1,400 mt for 2024 were up 29% from the previous week but down 71% from the prior 4-week average. The three largest buyers were Japan (1,300 mt), China (400 mt), and Italy (100 mt). Pork net sales of 7,500 mt for 2024 were up 6% from the previous week but down 60% from the prior 4-week average. The three largest buyers were Mexico (8,500 mt), Japan (600 mt) and Dominican Republic (400 mt).

LIVE CATTLE:

As if the rally on Thursday wasn't enough, traders have once again plunged into the live cattle complex, guns-a-blazing, as they've pushed several of the nearby contracts to new contract highs. So what's the driving force behind this newfound momentum, you ask? I believe it's the sober realization that so long as demand remains as plentiful as it was in 2024, the cattle complex (aside from any black swan events) is almost guaranteed to have another fruitful year as supplies are thin. Feedlot managers/cow-calf producers aren't squandering their time to shine as they hold the lion's share of the market's leverage. February live cattle are up $2.10 at $195.70, April live cattle are up $1.40 at $197.45 and June live cattle are up $0.42 at $191.77. And if the board's excitement wasn't enough to put a little pep in your step – the cash cattle market's success this morning surely will as some light traded trade is being reported at $315 which is $8.00 higher than last week's weighted average, and some more Southern live cattle trade has developed now at $197 which is $4.00 to $5.00 higher than last week's weighted average. Depending on where the week's weighted average falls, it's likely that the prices of $197 live and $315 dressed set new records for the fed cash cattle market.

Boxed beef prices are higher: choice up $1.46 ($324.94) and select up $1.83 ($296.06) with a movement of 84 loads (41.26 loads of choice, 12.96 loads of select, 18.34 loads of trim and 11.72 loads of ground beef).

FEEDER CATTLE:

With the help of the live cattle complex trading higher and this week's fed cash cattle market trading higher as well -- the nearby feeder cattle contracts are continuing to rally into Friday's noon hour with ease. January feeders are up $0.87 at $267.33, March feeders are up $0.40 at $266.60 and April feeders are up $0.25 at $266.77. Aside from the January 2025 contract, most of the nearby feeder cattle contracts have scored new contract highs as traders continue to push the market higher thanks to the relentless support of traders and their belief that fundamental support through 2025 should keep the market strong and elevated.

LEAN HOGS:

The lean hog complex isn't seeing the same level of support that the cattle contracts are as its market is trading mostly lower. And while one would usually expect higher pork cutout values to lend some support -- the market is instead trading lower as traders yearn to not only see higher daily prices but also to see consistency which has been nearly unattainable for the market as of late. February lean hogs are up $0.22 at $81.35, April lean hogs are down $0.07 at $86.47 and June lean hogs are down $0.27 at $99.15.

The projected lean hog index for 1/2/2024 is down $0.87 at $83.12, and the actual index for 12/31/2024 is down $0.28 at $83.99. Hog prices on the Daily Direct Morning Hog Report average $79.69, ranging from $77.00 to $81.00 on 4,033 head and a five-day rolling average of $79.65. Pork cutouts total 188.34 loads with 169.64 loads of pork cuts and 18.70 loads of trim. Pork cutout values: up $2.23, $91.55.