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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.

ShayLe Stewart
DTN Livestock Analyst

   General Comments

   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.

   LIVE CATTLE

   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

   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.

   LEAN HOGS

   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 
mt).

   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 shayle.stewart@dtn.com

    

    




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