DTN Midday Livestock Comments 07/23 11:36

DTN Midday Livestock Comments 07/23 11:36 Support Finds the Livestock Contracts Midday Friday Heading into Friday's afternoon, the cattle market braces itself for two big reports -- the biannual Cattle Inventory report and the monthly Cattle on Feed report. ShayLe Stewart DTN Livestock Analyst GENERAL COMMENTS: The feeder cattle market was able to shoot higher from the day's start as the corn market keeps trending lower, but the live cattle and lean hog contracts took a little more convincing. The cash cattle market hasn't seen an ounce of interest throughout Friday's trade thus far and it's looking like this week's business is essentially done with. December corn is down 12 3/4 cents per bushel and December soybean meal is down $5.50. The Dow Jones Industrial Average is up 199.21 points and NASDAQ is up 120.53 points. LIVE CATTLE The live cattle market has seen a mixed bag of tricks throughout the week. Boxed beef prices (though we expect to continue to trend lower) have been trending mildly higher over the last two days. The futures market has seen continued support as the contracts rally, but yet the market sees a weaker slaughter pace and lower fat cattle prices. If you ever thought markets should be simple, here's your lesson of why they aren't! August live cattle are up $0.55 at $121.35, October live cattle are up $0.42 at $127.10 and December live cattle are up $0.52 at $132.37. The cash cattle market hasn't seen so much as one bid renewed as of yet, and it's very likely that the bulk of this week's trade is done with. Throughout the week, Northern dress trade has been at $194 to $202, mostly $195, which is $3.00 lower than last week's weighted average. Southern live have been marked at $117 to $119, mostly $119, roughly $1.00 lower than last week's weighted averages. Friday afternoon will be busy as the market awaits both the monthly Cattle on Feed report and the biannual Cattle Inventory report. Neither are expected to shake the market in any significant manner. The Cattle on Feed report may show higher placements as drought continues to plague cattlemen in the western states. Boxed beef prices are higher: choice up $0.42 ($266.56) and select up $1.24 ($251.01) with a movement of 78 loads (54.24 loads of choice, 10.69 loads of select, zero loads of trim and 13.32 loads of ground beef). FEEDER CATTLE As the corn market continues to chop sideways, the feeder cattle contracts rally in sheer delight. The market has the support fundamentally as corn in trending sideways to somewhat lower and feeder cattle buyers are eager to get their orders filled. The technical side of the market is showing strong support, but the spot August contract doesn't seem interested in taking on the resistance at $160. Early next week, traders will have to address the market (corn prices, fundamental feeder demand, long-term live cattle prices) and see if there's enough reason to move the market past the long-term resistance. August feeders are up $1.17 at $159.37, September feeders are up $1.50 at $162.20 and October feeders are up $1.35 at $163.97. LEAN HOGS After having a tough trade throughout Thursday, the lean hog market has rallied support in its nearby contracts while the deferred continue to trend slightly lower. August lean hogs are up $0.60 at $107.22, October lean hogs are up $1.42 at $93.17 and December lean hogs are up $0.95 at $85.95. It's not concerning to see that packers weren't aggressive in Friday morning's cash hog trade, as they were aggressive in the cash market earlier in the week and want to see how next week's demand holds before they throw more money at chasing thin hog supplies. Watching to see where the afternoon's pork cutout value closes will be important. The projected CME Lean Hog Index for July 22 is down $0.04 at $112.23, and the actual index for 7/21/2021 is down $0.08 at $112.27. Hog prices are unavailable on the National Direct Morning Hog Report due to confidentiality. However, we are able to see that there's been 3,126 head sell and that the five-day rolling average is at $105.99. Pork cutouts total 160.22 loads with 147.42 loads of pork cuts and 12.80 loads of trim. Pork cutout values: up $4.72, $127.03. ShayLe Stewart can be reached at shayle.stewart@dtn.com (c) Copyright 2021 DTN, LLC. All rights reserved.