DTN Midday Livestock Comments 10/04 11:31
Support Resurfaces for Cattle, but Hogs Continue to Trade Lower
After Tuesday's descend, the cattle contracts are back to trading higher,
but the hog complex isn't finding the same support.
DTN Livestock Analyst
After a politically charged Tuesday with Speaker of the House Kevin McCarthy
being voted out of his position, the livestock contracts are longing to find
stability in Wednesday's market and thankfully support is appearing. Even
though the contracts are only trading higher gingerly, higher is higher.
December corn is down 1/4 cent per bushel and December soybean meal is up
$2.10. The Dow Jones Industrial Average is up 69.34 points.
The live cattle complex is trading higher after the market was sent tumbling
lower throughout Tuesday's trade. The spot December contract is trading below
it's 40-day moving average, but the market continues to trade above it's
100-day moving average. So long as beef demand doesn't show much more softness
and cash prices maintain their trend of trading just $1.00 or $2.00 lower this
week, it's likely that the market's long-term fundamental outlook could keep
the complex from dropping below it's 100-day moving average. October live
cattle are up $0.60 at $182.77, December live cattle are up $0.65 at $186.30
and February live cattle are up $0.27 at $190.57. There's a single bid being
offered in Texas at $182, but, at this point, feedlots don't seem overly
worried about marketing any more cattle just yet. There was some business that
took place Tuesday afternoon in the South at $182, which is $1.00 softer than
last week's weighted average, and some light Northern trade developed at $183
which is also just $1.00 lower than last week's weighted average. Asking prices
in the South are noted at $183-plus and in the North at $290-plus.
Boxed beef prices are lower: choice down $2.11 ($297.96) and select down
$0.60 ($274.99) with a movement of 100 loads (57.99 loads of choice, 24.41
loads of select, 10.16 loads of trim and 7.20 loads of ground beef).
Even though the live cattle contracts are trading mildly higher and one
could say that should lend feeders some support, Tuesday's spike in the number
of available job listings in the U.S. still isn't sitting well with the feeder
cattle complex as that will likely ensure that interest raters are increased
later this month. October feeders are down $0.35 at $248.25, November feeders
are down $0.07 at $250.27 and January feeders are down $0.37 at $253.90. Sales
were mixed throughout the countryside on Tuesday, but the CME Feeder Cattle
Index continues to trade above $250.00, which is a positive sign.
Mostly the lean hog complex is keeping with its descend as the market
continues to look for a bottom in this trading move. Both the February 2024 and
April 2024 contracts are trading higher as traders believe that supplies could
be tighter at that point, but otherwise the contracts continue to trade lower
as fundamental support is spotty and technically the market continues to be
plagued with timidness from traders. October lean hogs are down $0.17 at
$79.77, December lean hogs are down $0.02 at $69.05 and February lean hogs are
up $0.30 at $73.02.
The projected lean hog index is delayed from the source. Hog prices are
higher on the Daily Direct Morning Hog Report, up $2.24 with a weighted average
price of $72.87, ranging from $65.00 to $74.00 on 1,751 head and a five-day
rolling average of $73.13. Pork cutouts total 154.10 loads with 131.84 loads of
pork cuts and 22.26 loads of trim. Pork cutout values: up $1.14, $95.75.
ShayLe Stewart can be reached firstname.lastname@example.org
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