DTN Livestock Midday: Market Pressure Continues

Photo: Blair Fannin, Texas AgriLife Extension

Yet another day engulfs the livestock contracts as prices drop lower and the thought of finding stability isn’t easily understood.

General Comments

Livestock contracts don’t have a lot of hopefulness for the day as the future’s contracts trail lower and the cash cattle market isn’t looking to trade positively.

March corn is down 1 3/4 cents per bushel and March soybean meal is down $1.60. The Dow Jones Industrial Average is up 130.31 points and NASDAQ is up 34.73 points.

LIVE CATTLE

Support in the cattle contracts seems to be as reliable as a flickering flashlight while you’re night calving that one cow who’s tag reads, “spooky, jumpy, *$*@_%!.” Earlier in the day live cattle and feeder cattle contracts attempted (ever so timidly) to press prices higher but support quickly fell and prices continue to drop for the fifth day now.

And, not helping matters, packers are ready and eager to buy up fats while the market is depressed and opportunity to buy low presents itself. Packers have placed bids of $121 for live cattle in Nebraska and Texas, and $194 for dressed cattle in Nebraska. Asking prices are $125-plus in the South and $201 in the plus in the North.

The Fed Cattle Exchange Auction listed three lots Wednesday morning totaling 477 head, all were set for 1-9 day delivery. Asking prices were at $123, but none sold. February live cattle are down $0.12 at $122.02, April live cattle are down $0.20 at $120.50 and June live cattle are down $0.35 at $112.12.

Boxed beef prices are mixed: choice up $0.98 ($213.83) and select down $0.13 ($212.03) with a movement of 70 loads (43.94 loads of choice, 7.55 loads of select, 5.75 loads of trim and 12.90 loads of ground beef).

FEEDER CATTLE

The feeder cattle market opened higher than Tuesday’s close and seemed to have a shot of support and energy but not long after the day’s opening, the market shot lower and continues to trade $0.05 to $0.87 lower.

January feeder cattle are up $0.07 at $142.12 (and expire Thursday), March feeder cattle are down $0.10 at $135.30, April feeders are down $0.42 at $137.35 and May feeders are down $0.50 at $139.55. With support in the live cattle contracts becoming slimmer and slimmer, the feeder cattle contracts are going to have a tough go.

LEAN HOGS

Lean hogs may be leading the plunge lower on the board but at least the cash hog market is rallying. Lean hog contracts dive anywhere from $1.27 to $2.30 lower as the day enters the noon hour. February lean hogs are down $1.50 at $64.72, April lean hogs are down $2.30 at $69.00 and May lean hogs are down $2.17 at $75.47. Thankfully packers are still keeping a swift slaughter pace helping to keep one side of the market positive for the hog sector.

The projected lean hog index for 1/28/2020 is up $0.66 at $62.40, and the actual for 1/27/2020 is u $0.10 at $61.74. Hog prices are higher on the National Direct Morning Hog Report, up $0.68 with a weighted average of $55.48, ranging from $49.00 to $58.00 on 7,825 head and a five-day rolling average of $53.55.

Pork cutouts total 195 loads with 172.94 loads of pork cuts and 22.07 loads of trim. Pork cutout values: down $2.85, $73.03.

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