DTN Midday Livestock Comments 10/01 12:28
Cash Cattle Trade is Vibrant Again Thursday
Though the livestock complex is split, trying to wade through the bullish
and bearish indicators, the day is seeing some positive support building.
DTN Livestock Analyst
As Thursday has progressed and enters the afternoon, more support has
developed through the feeder cattle and lean hog complexes that were trading
lower earlier Thursday morning. Cash cattle trade has been steady with the
week's pre-established prices, marking a solid $2.00 jump from last week's
average. December lean hogs are down $0.48 at $62.625, December corn is up 4
3/4 cents per bushel and December soybean meal is up $6.10. The Dow Jones
Industrial Average is up 118.67 points and NASDAQ is up 111.19 points.
As Thursday morning cash cattle trade has supported higher prices, the board
scales higher boosted by the market's positive morale. October live cattle are
up $0.05 at $108.60, December live cattle are down $0.35 at $112.00 and
February live cattle are down $0.22 at $115.65. Though December 2020 and
February 2021 contracts are lower, the deferred contracts from there on out and
all scaling modestly higher. Cash cattle trade has been busy in the South as
both Texas and Kansas sell cattle again for $107 which is fully steady with
Wednesday's trade. Iowa has moved the market higher from Wednesday's business
though as dressed cattle have sold for $168 and live cattle for $108 -- $1.00
higher than Wednesday's trade and $3.00 higher than last week's trade.
Beef net sales of 24,700 mt reported for 2020 were up 37% from the previous
week and 67% from the prior four-week average. The three primary increases were
from Japan (9,900 mt, including decreases of 600 mt), South Korea (5,700 mt,
including decreases of 400 mt), China (4,300 mt).
Boxed beef prices are higher: choice up $0.84 ($218.58) and select up $0.89
($208.43) with a movement of 83 loads (42.24 loads of choice, 21.93 loads of
select, 5.56 loads of trim and 13.26 loads of ground beef).
Feeder cattle contracts are hesitant about the marketplace as Wednesday
posted a monstrous corn rally, and though prices are only rallying a fraction
of what they were compared to Wednesday, the $0.02 to $0.07 rally has feeders
on edge. October feeders are up $0.50 at $141.87, November feeders are down
$0.02 at $142.02 and January feeders are down $0.07 at $140.22. Despite
concerns about feed costs, the feeder cattle market has warmed up to the idea
of trading higher as the live cattle complex trades mostly higher and the cash
cattle market is looking at moving this week's prices at least $2.00 higher.
The lean hog complex put a lot of pressure on Thursday's export report
hoping that export sales would be astronomically higher and that the market
would see significant support, but unfortunately, Thursday's report didn't
match those expectations. That's not to say that export demand won't rise at
some point down the road, but pork producers and traders alike must remember
that the U.S. isn't the only source of pork for other nations. October lean
hogs are up $1.20 at $74.00, December lean hogs are down $0.52 at $62.57 and
February lean hogs are down $0.37 at $67.62.
Pork net sales of 39,500 mt reported for 2020 were up 5% from the previous
week, but down 8% from the prior 4-week average. The three primary increases
were for Mexico (17,900 mt, including decreases of 1,000 mt), China (6,500 mt,
including decreases of 1,100 mt), Canada (4,400 mt, including decreases of 400
The projected lean hog index for 9/30/2020 is up $0.20 at $76.74, and the
actual index for 9/29/2020 is up $0.63 at $76.54. Hog prices are lower on the
National Direct Morning Hog Report, down $1.10 with a weighted average of
$63.60, ranging from $60.00 to $64.00 on 3,792 head and a five-day rolling
average of $64.13. Pork cutouts total 165.04 loads with 137.96 loads of pork
cuts and 27.08 loads of trim. Pork cutout values: up $8.69, $100.06.
ShayLe Stewart can be reached email@example.com
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