DTN Midday Livestock Comments 01/26 11:42
Strong Exports Help Boost the Morale for Lean Hogs
Heading into Thursday's afternoon, all eyes and ears will be keyed into the
cash cattle market to see if cattle trade in the afternoon.
DTN Livestock Analyst
The cattle contracts are trading lower into Thursday's afternoon as
cattlemen note the uptick in corn prices and anxiously wait to see what this
week's cash cattle market does. The lean hog complex is trading higher as the
market is thankful for the additional demand via exports and hopes that pork
cutout values again close higher. March corn is up 5 3/4 cents per bushel and
March soybean meal is up $8.50. The Dow Jones Industrial Average is up 58.92
As the live cattle market heads into Thursday's afternoon, feedlots are
being strategically patient in waiting to trade cattle this week. The futures
complex is trading slightly lower as the market is chomping at the bit to see
how prices fare this week in the cash market, but thus far, feedlots seem
uncompelled to let cattle trade at the bid prices being offered. Bids of $153
live and $245 to $246 dressed care being offered in Nebraska, and bids of $246
are noted in Iowa, but otherwise, the market sits idly. Bids and packer
interest is expected to intensify later Thursday afternoon. February live
cattle are down $0.47 at $157.12, April live cattle are down $0.55 at $161.00
and June live cattle are down $0.40 at $157.80.
Beef net sales of 25,100 mt for 2023 were primarily for South Korea (10,00
mt), Japan (4,400 mt) and China (4,200 mt).
Boxed beef prices are mixed: choice up $0.23 ($268.51) and select down $0.15
($251.65) with a movement of 61 loads (36.19 loads of choice, 12.32 loads of
select, 3.02 loads of trim and 9.86 loads of ground beef).
With corn prices fronting a $0.01 to $0.06 rally into Thursday's afternoon,
it comes as no surprise that the feeder cattle complex is under pressure. March
feeders are down $0.45 at $183.30, April feeders are down $0.82 at $187.52 and
May feeders are down $0.92 at $191.65. The cash cattle market is seeing bids
develop, but there hasn't been a big movement of cattle yet to speak of. If
cash cattle trade at least steady, that will be a positive win in feeder's eyes.
With strong export sales to start the day off on the right foot, the lean
hog complex has been rallying into Thursday's noon hour from the get-go. It's
not surprising to see cash hog prices lower as packers were aggressive in the
cash market early this week. However, the market is seeing support as pork
cutouts are higher. It's too early to say whether or not afternoon pork cutout
values will close higher or not, but if the do the market stands an excellent
chance at rallying into Friday as support has been ample throughout Thursday's
trade. February lean hogs are up $0.37 at $77.17, April lean hogs are up $1.82
at $87.15 and June lean hogs are up $1.40 at $103.15.
The projected lean hog index for Jan. 25 is up $0.20 at $72.52 and the
actual index for Jan. 24 is up $0.22 at $72.32. Hog prices are lower on the
Daily Direct Morning Hog Report, down $1.94 with a weighted average of $70.33,
ranging from $67.00 to $72.50 on 3,858 head and a five-day rolling average of
$71.04. Pork cutouts total 134.64 loads with 118.40 loads of pork cuts and
16.24 loads of trim. Pork cutout values: up $2.74, $81.85.
Pork net sales of 44,700 mt for 2023 were primarily for Mexico (17,700 mt),
China (12,500 mt) and Japan (3,700 mt).
ShayLe Stewart can be reached firstname.lastname@example.org
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