DTN Midday Livestock Comments 09/27 11:43
Have Hogs Found Some Technical Footing?
The cash cattle market expects packer interest to improve heading into
DTN Livestock Analyst
It's a mixed marketplace for the livestock industry as the lean hog complex
is trading mildly higher but the cattle contracts can't seem to find support.
Some light cash cattle trade developed this morning in the North at $290 to
$291, but that's not to say that a market trend has been established for the
week. December corn is up 4 3/4 cents per bushel (bu) and December soybean meal
is down $3.10. The Dow Jones Industrial Average is down 194.33 points.
The live cattle complex is still trading lower and is again pressuring the
bottom side of the market's current trading range. It's not helping that some
light cash cattle trade has already begun to develop late Tuesday afternoon.
Some Southern trade was marked at $183, which is fully steady with last week's
weighted average, but this morning some light trade (extremely few head) was
noted in Nebraska at $290 to $291, which is $1 to $2 lower than last week's
weighted average. There still isn't a consensus as to where the week's cash
cattle market is going to trade, but steady to weaker tones seem to be the
early trend. October live cattle is steady at $184.80, December live cattle is
down $0.35 at $188.12 and February live cattle is down $0.65 at $192.40. More
cash cattle trade will develop throughout the week and it's likely that packers
may even begin to procure more cattle this afternoon.
Boxed beef prices are mixed. Choice is up $0.88 ($300.42) and select is down
$0.56 ($278.54) with a movement of 89 loads (51.94 loads of choice, 18.15 loads
of select, 3.19 loads of trim and 16.10 loads of ground beef).
With corn prices pushing a mild $0.04 rally, the feeder cattle complex
continues to trade lower as the market comes up short of some much-needed
technical support. Feeder cattle and calf prices have been softer this past
week in the countryside with many sale barns noting farmers are still out in
the field and not showing up as buyers yet.
Unweaned or unvaccinated calves are seeing the steepest price regression,
which is expected. It's likely this lackluster tone will remain in the market
through the week's end or until cash cattle prices or the live cattle contracts
begin to trade higher again and lend the market some support. October feeders
are down $1.87 at $252, November feeders are down $2.22 at $254.70 and January
feeders are down $2.72 at $257.37.
The lean hog complex is trading higher again as the market seems to find
some footing technically speaking as the spot December contract is trading
sideways with last Friday's close. October lean hogs are up $0.47 at $82.10,
December lean hogs are up $0.60 at $72.92 and February lean hogs are up $0.67
at $76.42. Based on pre-report estimates, it's likely Thursday's Hogs and Pigs
Report will be favorable to the market with tighter supplies hopefully
correlating to stronger pork prices in the future. The report will be released
at 2 p.m. Thursday (Central).
The projected lean hog index for Sept. 26 is down $0.17 at $86.14, and the
actual index for Sept. 25 is down $0.39 at $86.31. Hog prices on the Daily
Direct Morning Hog Report average $76.72, ranging from $74.50 to $79 on 4,412
head and a five-day rolling average of $77.31. Pork cutouts total 151.32 loads
with 135.98 loads of pork cuts and 15.34 loads of trim. Pork cutout values are
up $0.54 at $98.82.
ShayLe Stewart can be reached firstname.lastname@example.org
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