DTN Midday Livestock Comments          07/09 12:33

   Up Go the Livestock Contracts

   Seeming to have relighted a fire in the livestock contracts, all three 
sectors are rallying at midday.

ShayLe Stewart
DTN Livestock Analyst

   General Comments

   Rolling into the noon hour, the livestock complex had a change of heart as 
all three markets trade higher. Feeder cattle contracts and the live cattle 
sector are rallying with the same aggression as multiple contracts jump upwards 
of $1.00 higher, and the lean hog complex is seeing positive support through 
nearby contracts while the deferred contracts aren't as sold on the notion. 
Thankfully cash trade is higher in the lean hog complex Thursday morning, 
helping to aid the movement along. December corn is up 5 1/2 cents per bushel 
and December soybean meal is up $3.90. The Dow Jones Industrial Average is down 
367.85 points and NASDAQ is down 14.56 points.

   LIVE CATTLE

   Feeling optimistic after trading lower the last couple of days, the live 
cattle complex has resparked its momentum and is trading higher. August live 
cattle are up $0.47 at $99.62, October live cattle are up $0.42 at $103.92 and 
December live cattle are up $0.85 at $107.55. Amid the board's rally, cash 
cattle trade has been spotty as asking prices are hard to come by. Trade in 
Kansas and Texas has been aggressive early in the week but trade in Iowa and 
Nebraska has been slim thus far. More trade may develop into the afternoon but 
at noon the countryside is mostly quiet.

   Thursday's export report shared that beef net sales totaled 9,500 mt for the 
week ending July 2, which was down 23% from the previous week and down 51% from 
the prior four-week average. The three primary increases were from Japan (2,900 
mt including decreases of 500 mt), South Korea (2,300 mt including decreases of 
500 mt) and China (1,000 mt).

   Boxed beef prices are lower: choice down $0.45 ($203.38) and select down 
$0.86 ($194.66) with a movement of 93 loads (34.49 loads of choice, 25.29 loads 
of select, 18.65 loads of trim and 14.47 loads of ground beef).

   FEEDER CATTLE

   Feeder cattle contracts saw the strength rallying in the live cattle 
contracts and opted to hop on board and make a run while the support is 
circulating. August feeders are up $0.57 at $134.62, September feeders are up 
$0.37 at $136.05 and October feeders are up $0.42 at $137.20. The boards midday 
jump should help afternoon sales throughout the countryside. Superior's Weekend 
in the Rockies Sale is being hosted this year from the Texas office as 
restrictions from COVID-19 have made it difficult to travel. But even with that 
being the case, yearlings are rallying at that sale upwards of $5.00 to $6.00 
stronger , continuing to add to the list of phenomenal feeder cattle sales this 
spring/summer.

   LEAN HOGS

   The lean hog complex is seeing the biggest push in nearby contracts and 
equivalently the same rallying support throughout other facets of the market -- 
cash hogs are up and pork cutout values are up over $4.00 at midday. July lean 
hogs are up $1.50 at $45.55, August lean hogs are up $2.05 at $50.00 and 
October lean hogs are up $1.57 at $50.37. Seeing that the day's rally is widely 
supported through the different factors, the market may have a chance of 
closing with the same momentum.

   Pork net sales of 31,500 mt were reported for 2020, which was down 20% from 
the previous week but up 6% from the prior four-week average. The three primary 
increase were from Mexico (9,100 mt including decreases of 300 mt), China 
(8,100 mt including decreases of 4,500 mt) and Japan (5,300 mt including 
decreases of 200 mt).

   The projected lean hog index for 7/8/2020 is down $0.17 at $45.18, and the 
actual index for 7/7/2020 is down $0.55 at $45.35. Hog prices are higher on the 
National Direct Morning Hog Report, up $0.30 with a weighted average of $29.23, 
ranging from $24.00 to $31.13 on 6,055 head and a five-day rolling average of 
$29.06. Pork cutouts totaled 155.90 loads with 134.65 loads of pork cuts and 
21.25 loads of trim. Pork cutout values: up $4.45, $71.61.

   ShayLe Stewart can be reached shayle.stewart@dtn.com

    




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