DTN Livestock Midday: Quiet Morning Trade

    ©Debra L Ferguson Stock Photography

    Heading into Friday afternoon, cattlemen await the Cattle on Feed report due out at 2 p.m. CST.

    GENERAL COMMENTS:

    It’s been a quiet day for the livestock complex as the market isn’t seeing much interest develop technically or fundamentally. Before Friday’s last call, the market will be waiting for the latest Cattle on Feed report, but otherwise, by and large, the week’s trade is done with.

    December corn is down 2 1/4 cents per bushel and December soybean meal is up $2.50. The Dow Jones Industrial Average is down 185.40 points and NASDAQ is up 105.62 points.

    LIVE CATTLE:

    The live cattle complex has had another stellar week as the futures have trended higher, cash cattle prices traded $1.00 to $3.00 higher and slaughter speeds were aggressive again. Live cattle futures are trending modestly higher in the nearby, spring months of 2022; but come the summer of 2022 the contracts are veering modestly lower. With feedlots extremely current on their showlists, they aren’t afraid to sit through Friday’s trade and hold cattle over until next week.

    It’s unlikely next week’s trade will be as vast as buyers don’t want to be burdened over the holiday week; but come the following week, trade will resume as normal. December live cattle are up $0.32 at $133.47, February live cattle are up $0.27 at $137.52 and April live cattle are up $0.25 at $141.12. The cash cattle market sits idle without any bids renewed. It’s likely trade is essentially done and, if any trade does develop, it will most likely be for steady prices with the week’s trend.

    Throughout the week, Northern dressed cattle traded for $207 to $211, which is mostly $3.00 higher than last week. Southern live cattle traded for $132 to $134, which is $1.00 to $2.00 higher than last week. As the market makes its way into the afternoon, cattlemen will be watching for the Cattle on Feed report, which will be released at 2 p.m. CST.

    Boxed beef prices are higher: choice up $1.90 ($278.06) and select up $1.15 ($264.31) with a movement of 49 loads (27.77 loads of choice, 13.35 loads of select, zero loads of trim and 8.33 loads of ground beef).

    FEEDER CATTLE:

    After posting a monstrous rally Thursday afternoon, feeder cattle futures are mostly steady as the contracts look for reassurance. It’s appreciated, from feeders’ perspective, that the corn market is lower and the nearby live cattle futures are higher — but it’s unlikely the market will do anything drastic ahead of the weekend as traders made their bold move Thursday. January feeders are up $0.02 at $161.40, March feeders are up $0.07 at $163.62 and April feeders are up $0.05 at $166.12.

    Feeders see the April 2022 live cattle contract is trading above $140.00 (at $141.15 to be precise) and feel extremely encouraged about the year to come as the fat cattle market stands an excellent chance at keeping up with its current rally. Next week’s trade will be dismal throughout the countryside as it is Thanksgiving week and buyers don’t want to be on the road chasing sale barns and feedlots don’t want to have to receive and work the calves once they’re purchased. The feeder cattle market will be lightly tested until the Thanksgiving holiday has passed.

    LEAN HOGS:

    Lean hog futures are facing some modest pressure in nearby contracts, but deferred contracts are continuing to rally. December lean hogs are down $0.45 at $74.65, February lean hogs are down $0.50 at $82.80 and April lean hogs are down $0.07 at $87.52. It’s unlikely the market will do much more than continue to chop modestly sideways ahead of the close as traders know the week’s business is mostly done with. Fundamentally next week is problematic for the hog sector as the Thanksgiving holiday obviously means a lighter processing schedule and, with there already being plenty of hogs for packers to pick from, added inventory will only pressure the cash market more.

    The projected CME Lean Hog Index for 11/17/2021 is down $1.02 at $75.26, and the actual index for 11/16/2021 is down $0.05 at $76.28. Hog prices are lower on the National Direct Morning Hog Report, down $0.16 with a weighted average of $54.97, ranging from $54.00 to $56.74 on 3,880 head and a five-day rolling average of $56.49. Pork cutout values are unavailable due to technical issues at the USDA.

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