DTN Midday Livestock Comments 09/21 12:13
Livestock Contracts Lacking Trader Interest
As the day passes by, Monday's trade throughout the livestock sector has
been mostly quiet as the complex needs more trader action to move the
DTN Livestock Analyst
Trailing into Monday's afternoon trade, livestock contracts are still
feeling pressured -- especially in the cattle sector. Some of the downward
pressure is coming from lack of trader interest despite some strong incentives
popping up Monday as corn prices are lower and current showlists fall in favor
of cattle feeders. December corn is down 8 1/2 cents per bushel and December
soybean meal is down $2.70. The Dow Jones Industrial Average is down 750.32
points and NASDAQ is down 120.51 points.
Live cattle contracts haven't been as favorable to this week's beginning as
they were to last week's end. October live cattle are down $0.85 at $106.50,
December live cattle are down $1.45 at $110.40 and February live cattle are
down $1.17 at $114.90. As the market seems to be in left field, trading with
minimal trader interest, the market is left with not other option but to scale
lower. If the board ends up trading somewhat favorably to feeders, and Friday's
Cattle on Feed report doesn't create too much of a stir in the marketplace,
feedlots may be able to work a stronger (at least steady) market again this
week. New showlists appear to be somewhat smaller in Texas, and lower in Kansas
Last week's negotiated purchases totaled 105,118 head. Of that 84,204 head
are committed for delivery in the next two weeks, while the remaining 20,914
head are for delivery in the following 15 to 30 days.
Boxed beef prices are higher: choice up $1.22 ($216.86) and select up $1.46
($205.40) with a movement of 40 loads (26.40 loads of choice, 6.33 loads of
select, 3.84 loads of trim and 3.70 loads of ground beef).
The feeder cattle complex is balancing a tough market as there's pressure on
the board at $144, willing the market to trade lower, and the demand throughout
the countryside isn't even. Yearlings continue to sell for excellent prices (as
they easily sold $3.00 to $4.00 higher last week), vaccinated and weaned
spring-born calves are selling mostly steady but it's the bawling, unweaned
calves that are pulling the market lower. September feeders are down $0.20 at
$140.67, October feeders are down $0.87 at $141.55 and November feeders are
down $1.02 at $141.50.
Although the nearby lean hog contracts are feeling some pressure, the
complex is still trading mostly sideways keeping in its holding pattern awhile
looking for an export driver to again support the market. October lean hogs are
down $0.42 at $66.07, December lean hogs are down $1.10 at $62.42 and February
lean hogs are down $0.45 at $68.07. The market needs both fundamental and
technical support to be able to sustain the levels the board's at now. The
morning's cash trade was down slightly but on a considerable movement, and
hopefully the cutout value will be able to carry into the day's close.
The projected lean hog index for 9/18/2020 is up $1.71 at $71.29 and the
actual index for 9/17/2020 is up $1.74 at $69.58. Hog prices are lower on the
National Direct Morning Hog Report, down $0.13 with a weighted average of
$60.86, ranging from $55.00 to $64.00 on 7,496 head and a five-day rolling
average of $59.56. Pork cutouts total 160.81 loads with 135.29 loads of pork
cuts and 25.52 loads of trim. Pork cutout values: up $3.09, $90.62.
ShayLe Stewart can be reached firstname.lastname@example.org
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