DTN Midday Livestock Comments 01/23 12:03
Strong Morning for Lean Hog Market
Thursday aligns to be another positive day for lean hog contracts and a
lower day for cattle contracts.
By ShayLe Stewart
DTN Livestock Analyst
It's been a tough week for cattle contracts yet an inspiring week for the
lean hog market and if the lean hog sector can keep its momentum it's looking
the week could end that way too. March corn is up 3 1/2 cents per bushel and
March soybean meal is up $0.50. The Dow Jones Industrial Average is down 128.87
points and NASDAQ is down 8.39 points.
Live cattle contracts are having another dreary day realizing that with the
cash cattle market's trade pretty much set for the week (steady) that there's
not a lot of chance of future's gaining position as the lean hog market is
hitting the market with the aggression. Most of the business is anticipated to
be done in the South, and the North is still parking in some trade at $199
dressed and $124 live -- all steady with the last two weeks. The interesting
note about the trade in the North is that a lot of the cattle are selling with
delayed delivery for the week of February 3, which makes one anxious about the
cash cattle trade the next two weeks. February live cattle are down $0.75 at
$125.42, April live cattle are down $1.20 at $125.57 and June live cattle are
down $0.82 at $117.62.
Boxed beef prices are mixed: choice up $0.48 ($215.44) and select down $0.96
($211.06) with a movement of 69 loads (41.18 loads of choice, 16.21 loads of
select, 3.34 loads of trim and 8.64 loads of ground beef).
Wednesday was tough on the feeder cattle market, as contracts lost
significant position, and Thursday though less drastic is also trading lower.
January feeders are down $0.15 at $143.77, March feeders are down $0.12 at
$142.92 and April feeders are down $0.42 at $145.60. As cash cattle trade
lower, significant volumes of feeders sell at the sale barns and as the live
cattle contracts dip lower -- it makes it a tough road for feeder cattle
contracts to try to rally.
Higher future's market, higher cash prices, aggressive slaughter and higher
cutout values make for a very happy and healthy lean hog market. Nearby futures
contracts are pushing harder Thursday morning for higher prices and
interestingly cumulative interest is following right along. February lean hogs
are up $1.12 at $68.67, April lean hogs are up $1.07 at $75.60 and May lean
hogs are up $1.15 at $82.00.
The projected lean hog index for 1/21/2020 is up $0.84 at $61.02 and the
actual for 1/20/2020 is up $0.04 at $60.18. Hog prices are higher on the
National Direct Morning Hog Report, up $0.93 with a weighted average of $52.85,
ranging from $48.00 to $54.50 on 6,296 head sold and a five-day rolling average
of $51.92. Pork cutouts total 123.61 loads with 108.71 loads of pork cuts and
14.90 loads of trim. Pork cutout values: up $0.72, $79.46.
ShayLe Stewart can be reached email@example.com
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