DTN Midday Livestock Comments          09/17 12:14

   Cattle Markets Up, Corn and Lean Hog Contracts Sharply Lower 

   Tuesday morning opened an unexpected mixed market with both live cattle and 
feeder seeing gains in nearby and deferred contracts, whereas corn and lean hog 
contracts suffer. Cattle contracts could have been supported by the strength in 
the midday boxed beef cutout values and dwindling corn prices.  

By ShayLe Stewart
DTN Livestock Analyst

General Comments

   A positive board for cattle contracts early in the week could be a strong 
indication as to where the week could go if support remains and cash trade 
follows suit. The complex will have a lot of pressure to navigate through with 
the COF report coming out Friday, and large runs of cattle beginning to hit the 
scales at sale barns for the early fall sales. December corn is down 5 3/4 
cents, at $3.6825. The Dow Jones is down 50.14 points, and the NASDAQ is down 
0.46 points. 

   LIVE CATTLE: 

   Tuesday's midday market shows intention of making gains, and hopefully 
keeping them! Tuesday live cattle opened at $98.200, and have etched upwards to 
$99.525, a $1.525 gain. Nearby and deferred contracts all have gains at midday, 
with the strongest gain being seen in February 2020. If Tuesday's market keeps 
its gains through closing, this could be a signal to the cash market to take 
$1-$2. As of midday, no bids or cash trades have been established. With a 
strengthening board, packers will be leery whether or not the gains will stick, 
and feedlots will want to see just how far this rally could go before they bid 
their cattle. 

   Wednesday's Fed Cattle Exchange currently has 1,229 head of cattle consigned 
to the sale, with a healthy mix of both steers and heifers, ranging anywhere 
from one-to-nine-day-delivery, or one-to-17-day-delivery periods, and an 
average weight of 1,252 pounds. Estimates for September's Cattle on Feed report 
have come out with cattle on feed expected at 99.0%, placements at 92.0%, and 
marketing at 98.1%. With COF placement numbers lower, some are expecting a 
bullish market outcome.

   Boxed beef cutouts at midday are higher with choice up $1.39 ($222.01) and 
select up $0.42 ($196.99). Tuesday's offering of boxed beef movement is just 
slightly lower that Monday's midday offering 58 total loads versus Monday's 60 
loads. Tuesday's 58 total loads comprised 25.75 loads of choice, 14.03 loads of 
select, 9.14 loads of trimmings and 9.13 loads of ground beef. 

   FEEDER CATTLE: 

   October feeder cattle are on a roll Tuesday morning seeing seeking greater 
gains than the live cattle contracts. The October feeder cattle contract opened 
Tuesday morning at $134.100, and has since then jumped to $138.525, taking a 
$4.325 gain. Whether this rally is in conjunction with the live cattle 
contract, or because corn prices have been hit hard, feeders will gladly take 
the gain regardless! 

   LEAN HOGS:

   The Tuesday lean hog market opened at $70.450, and has since then dropped to 
$67.878, a $2.800 change. Nearby and deferred contracts have followed suit this 
morning, and there's no indication that there will be a strong close for 
Tuesday's ending if cattle markets continue to surge, and corn prices stay 
down. 

   The projected lean hog index for 9/16/19 is $57.49, down $0.99, and the 
actual price for 9/13/19 came to $58.48, down $1.23. Prices are down again 
Tuesday on the National Direct Morning Hog Report, down $0.83, at a weighted 
average of $44.26, ranging from $43.50 to $46.00, on 4,600 head sold, and with 
a five-day rolling average of $45.93. Pork cutouts came to 248.76 loads, with 
229.65 loads of pork cuts, and 19.10 loads of trimmings. Pork cutout values 
came in $0.69 higher at $69.35.  

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


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