Market News
New contract highs set in cattle futures
Cattle country was untested on Tuesday afternoon with significant buyer interest probably delayed until late in the week. A few asking prices have been identified around 167.00 to 168.00 in the South, and 255.00 to 260.00 in the North. Needless to say given last week’s enormous price surge many feedlot operators are reluctant to price cattle too cheaply. The kill totaled 116,000 head, 3,000 below last week and 10,000 smaller than a year ago.
Boxed beef cutout values were weak on the choice and higher on select on light to moderate demand and offerings. Choice beef was.31 lower at 251.08 and select was .84 higher at 238.68.
Live cattle contracts on the Chicago Mercantile Exchange settled 35 to 142 points higher as firm support held across the complex on Tuesday, although it was a struggle to draw increased trade support into the market. Triple digit gains in the feeder cattle helped to support live cattle contracts. October settled 1.15 higher at 159.67, and December was up 1.42 at 162.27.
Feeder cattle ended the day 130 to 207 points higher setting another round of contract highs. Traders continued to focus on the continued tight supply of cattle available to move into feedlots over the next few months and expected continued pressure in the corn market. September settled 1.47 higher at 228.62, and October was up 1.82 at 227.75.
Feeder cattle receipts at the Oklahoma National Stockyards on Monday totaled 9800 head. Compared to two weeks ago, feeder steers trended 8.00 to 12.00 higher. Feeder heifers were lightly tested and 3.00 to 8.00 higher. Steer and heifer calves were mostly steady. The demand continues very goods for all classes with the best demand noted on larger packages of weaned cattle. Feeder steers medium and large 1 averaging 734 pounds brought 235.83 per hundredweight. 722 pound replacement heifers traded at an average of 224.85.
Lean hogs settled 50 to 270 points higher. Traders concentrated on squaring positions following the sharp losses and widespread liquidation seen Monday in the October contract. Traders are looking for firm support through the overall complex and firming pork value support over the next few days. October settled 2.70 higher at 105.77, and December was up 2.20 at 98.25.
Barrows and gilts in the Iowa/Minnesota direct trade closed 1.75 higher with a weighted average of 101.30 on a carcass basis, the West is 1.72 higher at 101.21, and the East was .46 higher at 94.02. Missouri direct base carcass meat price was steady to 1.00 higher from 87.00 to 93.00. Midwest hogs on a live basis were steady from 60.00 to 66.00.
The pork carcass cutout value was up 1.74 at 105.28 FOB plant.
While the post-Labor-Day rally in the oversold cash hog market could be extended for another 2-3 weeks, few doubt this reprieve is anything more than a temporary lull in the seasonal storm. With new lows likely through most of October and November, specs and commercials will remain on the defensive, ready to lean into board improvements when the opportunity seems right according to DTN analysts.
Hog slaughter was estimated at 405,000 head, 7,000 less than last week and down 22,000 from last year.
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