Feedlot country was a naturally a slow affair as buyers focused exclusively on the collection of new showlists. The late month offering looks generally smaller than last week, especially in the South. According to the closing report, the national hog base is $.39 higher ($60.00-$66.50, weighted average $64.85). The corn market stepped into the new week with confidence for once, closing 6 cents plus lower thanks to short covering and commercial buying. The stock market closed lower with the Dow off 54 points and the Nasdaq down by 42.
Not surprisingly, live contracts opened sharply lower as traders initially reacted to the larger than expected September placement documented on Friday. What was surprising was the quick manner bulls climbed back in the saddle to aggressively buy early session lows. Traders quickly left triple-digit losses in the dust. By the tie the turnaround session ended, prices were no worse than mixed, up 45 to off 25. Clearly, demand optimism continues to be a big factor in this market. Beef cut-outs: lower, off $.09 (select: $191.05) to $.61 (choice: $199.25) with light to moderate demand and offerings (38 loads of choice cuts, 22 loads of select cuts, 12 loads of trimmings, 14 loads of ground beef).
TUESDAY'S CASH CATTLE CALL:
Steady. Bids and asking prices should remain poorly defined tomorrow with significant trade volume possibly delayed until the second half of the week.
For the most part, feeders settled 10 to 45 points lower (i.e., 200-280 points above early session lows). The ability of 2018 live contracts to close in the green obviously helped a great deal here. On an estimated run of 7,500 head (near even with last week and 2016), Oklahoma City sold feeder steers and heifer steady to $4 lower. CME cash feeder index: 10/20: 154.69, off .10.
Lean issues closed widely mixed, up 27 to off 132. Spot December stumbled with a triple-digit loss, pressured by ideas that the contraseasonal cash rally seen this month is on the verge of running out of gas. Yet one day does not a trend change and Dec and Feb remain above multiple levels of technical support. The carcass value closed higher with strength in butts, ribs, and hams offsetting weakness in loins and picnics. Pork cut-out: $75.80, up .30. CME cash lean index for 10/19: 64.21, up .87 (DTN Projected lean index for 10/20: 65.23, up 1.02).
TUESDAY'S CASH HOG CALL:
Steady to $1 higher. Look for hog buyers to resume work in the morning with steady/firm bids.
John Harrington can be reached at email@example.com
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