DTN Midday Livestock Comments 08/17 11:33
Feedlots Still Waiting for Higher Cash Prices
The live cattle and feeder cattle contracts are trending higher into
Wednesday's afternoon as the market anxiously awaits to see just how powerful
this week's cash cattle trade is.
DTN Livestock Analyst
You've got to commend feedlots in their marketing tactics this week --
they've been patient in waiting for the prices they want. Bids of $150 live and
$237 to $238 dressed have been offered in Nebraska, but otherwise the market
sits quiet. December corn is up 3 3/4 cents per bushel and December soybean
meal is up $3.70. The Dow Jones Industrial Average is down 217.16 points.
The live cattle market is pressing onward into Wednesday's market as traders
push a modest advancement throughout the complex, as everyone anxiously awaits
to see what this week's cash cattle market accomplishes. So far just a few bids
of $150 live and $237 to $238 have been offered in Nebraska, but at this point
those bids are being passed on and feedlots seem dead set on getting $240 plus
in the North and $143 to $145 in the South. August live cattle are up $0.50 at
$141.80, October live cattle are up $0.20 at $145.87 and December live cattle
are up $0.25 at $151.45. Carcass data continues to prove that showlists are
extremely current and it's not unlikely that feedlots get their asking price or
more this week. Trade is expected to develop Wednesday afternoon.
The Fed Cattle Exchange Auction held today reported eight lots, totaling
1,203 head of cattle, all from Texas and none of which sold.
Boxed beef prices are mixed: choice up $0.06 ($265.50) and select down $0.56
($238.56) with a movement of 88 loads (42.02 loads of choice, 14.31 loads of
select, 9.42 loads of trim and 22.63 loads of ground beef).
Even with a slight $0.02 to $0.04 advancement in the nearby corn contracts,
the feeder cattle contracts are all trading higher as the market beams in
excitement to see the live cattle market trending higher. If the corn complex
poses much more of a threat, then the feeders will have to weigh the imposing
threat of higher corn against what the live cattle market is accomplishing, but
if cash cattle price advance $2.00 or more again this week, then feeders are
going to be ecstatic. August feeders are up $1.42 at $182.95, September feeders
are up $1.75 at $187.22 and October feeders are up $1.62 at $189.55.
The lean hog market is trending modestly higher into Wednesday's afternoon
as the market has found support after Tuesday's blood bath. October lean hogs
are up $0.92 at $97.50, December lean hogs are up $0.10 at $87.80 and February
lean hogs are up $0.35 at $90.60. The cash hog market is again seeing strong
interest as packers obviously didn't fulfill all their needs in Tuesday's
market. Midday pork cutout values are higher (which isn't anything to put too
much faith in), but if pork cutout values can round out the day higher, then
the market may be able to keep a sideways/modestly higher trend going as
Tuesday worked the market low enough that resistance pressure isn't an
The projected lean hog index for Aug. 16 is down $0.44 at $120.62 and the
actual index for Aug. 15 is down $0.65 at $121.06. Hog prices are higher on the
Daily Direct Morning Hog Report, up $8.32 with a weighted average of $128.87,
ranging from $114.00 to $136.00 on 14,387 head and a five-day rolling average
of $123.48. Pork cutouts total 160.13 loads with 140.79 loads of pork cuts and
19.34 loads of trim. Pork cutout values: up $2.38, $123.53.
ShayLe Stewart can be reached firstname.lastname@example.org
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