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DTN Midday Livestock Comments 11/27 12:05


DTN Midday Livestock Comments 11/27 12:05

Livestock Contracts Trade Mixed Following Thanksgiving

Livestock contracts continue to trade in a lackadaisical fashion on Friday
as a lot of traders are soaking up a long weekend.

ShayLe Stewart
DTN Livestock Analyst

GENERAL COMMENTS:

Heading into the afternoon, the livestock contracts are trading in a slow,
methodical post-Thanksgiving fashion. With the markets closing early Friday
afternoon and a lot of traders already checked out for the week for a long
weekend, Friday's trade throughout the futures market and in the cash cattle
market has developed in an unhurried cadence. March corn is up 5 cents per
bushel, and January soybean meal is down $0.40. The Dow Jones Industrial
Average is down 26.25 points, and the NASDAQ is up 93.46 points.

LIVE CATTLE:

The live cattle market couldn't pick up where it left off Thursday and rally
into Friday's trade. December live cattle are down $0.60 at $110.77, February
live cattle are down $0.82 at $113.32 and April live cattle are down $0.45 at
$117.02. Friday's unsupported trade really stems from the shortened holiday
week. The cash cattle market is still mostly quiet with a few bids being
renewed in Nebraska at $111 and a few cattle sold Friday morning in Texas for
$112. Some feedlots in eastern Nebraska have upped asking prices to $175 as
they know that packers need cattle and are in position to wait until the market
pays up.

Beef net sales of 15,500 metric tons (mt) were reported for 2020 -- a
marketing-year low -- up noticeably from the previous week and from the prior
four-week average. Increases were primarily for China (2,000 mt, including
decreases of 100 mt), Japan (1,800 mt, including decreases of 2,700 mt) and
Kuwait (100 mt).

Boxed beef prices are mixed: choice down $1.21 ($243.85) and select up $0.04
($220.94) with a movement of 27 loads (11.58 loads of choice, 2.97 loads of
select, 4.80 loads of trim and 7.16 loads of ground beef).

FEEDER CATTLE:

While live cattle contracts are trading lower, the feeder cattle market is
hoping to round out the week with the bullish attitude that's been supported
since Monday. January feeders are up $0.15 at $140.32, March feeders are up
$0.02 at $139.30 and April feeders are up $0.07 at $140.47. The corn market is
seeing some support that has elevated nearby contracts to $0.03 to $0.04
higher; thus far, the corn market's gain hasn't derailed the feeder cattle
contracts.

LEAN HOGS:

The lean hog market isn't being supported following the big Thanksgiving
holiday. December lean hogs are down $0.15 at $66.02, February lean hogs are
down $0.72 at $66.95 and April lean hogs are down $0.75 at $70. Following
Thursday's stronger close, the market was hopeful to keep scaling higher and to
eventually push out of the market's recent sideways trade. But based on
Friday's trade thus far, the hog market isn't looking prime to finding
midafternoon support before closing.

Pork net sales of 18,800 mt reported for 2020 were down 35% from the
previous week and 47% from the prior four-week average. The three primary
increases were for Mexico (9,400 mt, including decreases of 600 mt), Japan
(3,900 mt, including decreases of 200 mt) and China (2,500 mt, including
decreases of 600 mt).

The projected lean hog index for 11/24/2020 is down $0.32 at $67.38, and the
actual index for 11/23/2020 is down $0.13 at $67.70. Hog prices are lower on
the National Direct Morning Hog Report, down $0.41 with a weighted average of
$57.48, ranging from $57 to $58.50 on 3,840 head and a five-day rolling average
of $57.94. Pork cutouts total 129.64 loads with 116.86 loads of pork cuts and
12.78 loads of trim. Pork cutout values: up $0.45, $78.80.

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

**

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