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DTN Midday Livestock Comments 10/08 11:40
November Feeders Trading Above 100-Day Moving Average
With trades seeming committed to supporting the livestock complex, once
again all three of the markets are trading higher into the day's afternoon.
ShayLe Stewart
DTN Livestock Analyst
GENERAL COMMENTS:
Thus far it's been another prosperous day for the livestock complex as all
three markets are heading into Tuesday's noon hour higher. Asking prices are
noted in the South at $188 but have not yet been established in the North.
December corn is down 5 3/4 cents per bushel and December soybean meal is down
$2.30. The Dow Jones Industrial Average is up 72.35 points.
LIVE CATTLE:
The live cattle complex is charging higher into Tuesday's noon hour as
traders feel well supported by the higher note in choice cuts. Yes, select cuts
may be down slightly, but the recent rally in choice cuts has been rather
aggressive and could help lend enough support to the cash market for prices to
trade steady/somewhat higher again this week. It's too early in the week for
any cash cattle trade to have developed, but thankfully the fundamental support
is encouraging traders as the market continues to grind higher. October live
cattle are up $).72 at $188.20, December live cattle are up $0.60 at $187.62
and February live cattle are up $0.32 at $188.62. Asking prices are noted in
the South at $188 but are still not established yet in the North. Trade will
likely be delayed until Thursday or Friday as feedlot managers aim to advance
the market again this week even if packers have cut throughput.
Boxed beef prices are mixed: choice up $1.09 ($307.02) and select down $0.18
($289.15) with a movement of 67 loads (30.60 loads of choice, 18.85 loads of
select, 5.89 loads of trim and 12.11 loads of ground beef).
FEEDER CATTLE:
The feeder cattle complex is leading an impressive rally into Tuesday's noon
hour which has propelled the spot November contract to trade above its 100-day
moving average, which hasn't been done since early July. But as traders note
the continued support of steady/higher boxed beef prices (especially in the
choice cut) and again see traders willing to support the live cattle contracts
-- traders seem committed to advancing the feeder cattle market while buyer
demand in the countryside remains incredibly strong. It will be especially
interesting to see if the spot November contract can maintain its position
above the market's 100-day moving average through closing as that would signal
strong technical support and lead to the obvious question of: How high do
traders intend to move this market? October feeders are up $0.87 at $249.72,
November feeders are up $0.65 at $249.80 and January feeders are up $0.72 at
$246.90.
LEAN HOGS:
The lean hog complex is continuing to trade higher despite midday
fundamentals not lending much support. December lean hogs are up $0.22 at
$77.07, February lean hogs are up $0.02 at $80.62 and April lean hogs are down
$0.12 at $84.75. Unless the afternoon's carcass price closes higher, it's
likely that the futures market's rally could be stalemated come Wednesday as
traders won't likely elect to move the market any higher without the support of
strong market fundamentals.
The projected lean hog index for 10/7/2024 is down $0.04 at $84.22 and the
actual index for 10/4/2024 is down $0.57 at $84.26. Hog prices are unavailable
on the Daily Direct Morning Hog Report due to confidentiality issues. However,
we can see that only 718 head have traded, and the week's five-day rolling
average now sits at $74.02. Pork cutouts total 198.19 loads with 179.50 loads
of pork cuts and 18.69 loads of trim. Pork cutout values: down $1.24, $94.81.
ShayLe Stewart can be reached shayle.stewart@dtn.com
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