DTN Midday Livestock Comments 09/24 12:19
Bids Developing Throughout the Countryside for Cash Cattle
Cattle contracts are more than willing to trade modestly higher after
trading lower earlier this week.
DTN Livestock Analyst
Cattle contracts are continuing to trend higher and are soaking up the
support that was absent in the earlier part of the week. The lean hog market is
suffering from some disappointment in Thursday's export report as the market
was hoping to see the report unveil that demand was far beyond the last couple
of week's usual trade. Cash cattle trade is still mostly quiet, as feeders are
pushing for higher prices again this week.
December corn is down 5 cents per bushel and December soybean meal is down
$8.10. The Dow Jones Industrial Average is up 147.16 points and NASDAQ is up
Along with higher prices across the futures market, come bids from packers!
October live cattle are up $0.37 at $107.52, December live cattle are up $0.40
at $111.60 and February live cattle are up $0.27 at $115.07. Bids are starting
to surface as packers have offered bids of $103 and $163 in Nebraska, $105 in
Iowa and $103 in Texas. Feeders have yet to pull the trigger and let trade
begin, and it wouldn't be surprising if packers have to work on those prices a
little bit more before feeders become interested. Feeders are going to push
packers using stronger boxed beef prices as a talking point and know
full-heartedly that their showlists are current so there's room to roll cattle
over to the next week if the need arises. Asking prices are around $106 to $108
in the South, and $167 plus in the North.
Beef net sales of 18,000 mt reported for 2020 were up 26% from the previous
week and 36% from the prior four-week average. The three primary increases were
from Japan (4,500 mt, including decreases of 500 mt), South Korea (4,500 mt,
including decreases of 400 mt) and China (3,400 mt).
Boxed prices are higher: choice up $1.71 ($217.58) and select up $0.59
($208.19) with a movement of 75 loads (45.22 loads of choice, 10.75 loads of
select, 3.42 loads of trim and 15.38 loads of ground beef).
Continued weakness in the corn market and trader interest developing
throughout the cattle complex has allowed for feeder cattle contracts to scale
modestly higher. October feeders are up $0.35 at $141.87, November feeders are
up $0.37 at $142.02 and January feeders are up $0.62 at $140.57. As the day's
support solidifies, the market seems to be trading comfortably and should be
able to maintain these levels throughout the latter part of the day.
Whether you want to call it the market's nature or human's nature of "buy
the rumor, sell the fact," time and time again the market is disappointed with
how the fine details of the marketplace shake out. Thursday's export report was
somewhat disappointing to the hog industry as the report didn't highlight any
big news, and export demand was slightly lighter than the previous week. Adding
to the uncertainty of the marketplace is the release of the Hogs and Pigs
Report Thursday afternoon. Pre-report estimates are varying as COVID-19 as
skewed the year's marketing system but as of here lately domestic demand has
been commendable. October lean hogs are down $0.07 at $69.42, December lean
hogs are down $1.00 at $63.35 and February lean hogs are down $0.62 at $68.45.
Pork net sales of 37,800 mt reported for 2020 were down 25% from the
previous week and 13% from the prior four-week average. The three primary
increases were from Mexico (15,000 mt, including decreases of 800 mt), China
(8,200 mt, including decreases of 1,600 mt) and Japan (4,100 mt, including
decreases of 200 mt).
The CME lean hog index for 9/22/2020 is up $0.72 at $72.89, and the actual
index for 9/21/2020 is up $0.88 at $72.17. Hog prices are higher on the
National Direct Morning Hog Report, up $0.63 with a weighted average of $64.98,
ranging from $60.00 to $68.00 on 3,370 head and a five-day rolling average of
$62.17. Pork cutouts total 149.71 loads with 134.41 loads of pork cuts and
15.30 loads of trim. Pork cutout values: up $0.77, $89.74.
ShayLe Stewart can be reached firstname.lastname@example.org
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