DTN Livestock Midday: Futures Lower; Cash Markets Lower

Texas A&M AgriLife Extension Service photo by Adam Russell

Feeders in the South threw down their cards and let packers have cattle relatively early in the week for just steady prices. Feeders in the North have yet to really trade, but seeing that cattle in the South have given up for steady prices, getting higher prices in the North is going to be nothing short of a tall order.

General Comments

Thursday’s market isn’t anything overly delightful, as all three livestock contracts are trading with significant losses. But as we put the last few months into perspective, Thursday’s trade isn’t out of line. The market has been anxiously anticipating the signing of the phase-one trade agreement between the U.S. and China, and now that the agreement has been signed, the trade is looking forward and going about its normal business.

The anticipation of the agreement was factored into the market before the signing took place, so now that the agreement is completed, the market’s twitterpated feelings are left to fall as the hype is over, and now trade can roll on as is.

March corn is down 8 1/4 cents per bushel and March soybean meal is up $0.60. The Dow Jones Industrial Average is up 151.96 points, and the NASDAQ is up 55.03 points.

LIVE CATTLE

Trading early in the week for steady prices? That hasn’t been the market move of choice when feeders push for higher prices, and consequently, higher prices have yet to be seen this week. It’s looking like packers have had enough of paying higher for fats and are winning the race this week.

February live cattle are down $0.60 at $126.00, April live cattle are down $1.02 at $126.50 and June live cattle are down $0.72 at $118.67. A significant volume has traded in the South for steady prices of $124.00, and unless more trade breaks out later in the week, trade could be done in the South already.

Cattle in the North have yet to really set their market. Some cattle in the North have been bought steady at $124, but not enough to establish a market, and dressed cattle only have steady bids on the table as of now.

Boxed beef prices are higher: Choice up $0.04 ($212.57) and select up $1.52 ($211.19) with a movement of 64 loads (41.71 loads of choice, 13.68 loads of select, 0 loads of trim and 8.62 loads of ground beef).

FEEDER CATTLE

Feeder cattle contracts are following suit and trading lower, though are surviving the day better than their other livestock counterparts. January feeders are down $0.55 at $144.87, March feeders are down $0.70 at $144.47 and April feeders are down $0.80 at $147.40.

The week may end of a foul note, as fat cattle trade is looking to be fully steady unless something else comes about, at which point that leaves little room for feeder cattle contracts and live cattle contracts to trade higher.

LEAN HOGS

Lean hog contracts have escaped Thursday’s dwindling surprises and are right in line to steadily lower. February lean hogs are down $0.95 at $66.92, April lean hogs are down $1.15 at $73.82 and May lean hogs are down $0.67 at $80.80. With choppy sideways trade being the recent norm for lean hog contracts, it’s appealing to have the week’s end near so that, hopefully, the market can stabilize, reach some common ground and trade accordingly.

The projected lean hog index for 1/15/2020 is expected to be up $0.62 at $60.15, and the actual for 1/14/2020 was up $0.53 at $59.53. Hog prices are lower on the National Direct Morning Hog Report, down $0.28 with a weighted average of $51.48, ranging from $46.00 to $52.00 on 4,736 head sold and five-day rolling average of $50.94.

Pork cutouts total 182.23 loads with 162.19 loads of pork cuts and 20.05 loads of trim. Pork cutout values: up $0.98, $75.63.

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