DTN Midday Livestock Comments 12/20 11:37

DTN Midday Livestock Comments 12/20 11:37 Cattle and Hogs Need to See More Fundamental Support Both the live cattle and lean hog contracts are trading lower as traders long to see more fundamental support in the market before trading higher again. ShayLe Stewart DTN Livestock Analyst GENERAL COMMENTS: The livestock complex isn't seeing nearly as much support in Tuesday's market as it did on Monday, as both the live cattle and lean hog markets are trading lower. Meanwhile, the feeder cattle complex is trading higher, seeming to want to regain some of the position which was lost Monday. March corn is up 3 1/4 cents per bushel, and March soybean meal is up $3. The Dow Jones Industrial Average is up 107.40 points. LIVE CATTLE: After moving slightly higher at Monday's start and championing the day with a stronger close, Tuesday's live cattle market has unfortunately not seen the same support and is trading lower into Tuesday afternoon. The market won't likely see enough support from either traders or the cash sector to break above current resistance levels ahead of the long Christmas weekend. So, until then, feedlots are hoping to keep prices at least steady in the cash market and pray that beef demand continues to show modest support, which will make dealing with packers much easier. The big kicker and change in the market over the last two weeks has been throughput. Packers are soberly aware that fed cattle supplies are thin, and that trend will likely be the springboard for the cash cattle market all throughout 2023 and potentially 2024. Nevertheless, packers are setting out to protect some of their margin by controlling chain speeds, which alleviates their direct need to chase cash cattle supplies. The countryside hasn't seen any interest at this point in the cash market, but it's still early for trade to have developed. Early asking prices in the South are noted at $156 plus and are still undeveloped in the North. Trade won't likely develop until Wednesday at the earliest or sometime Thursday. December live cattle are down $0.20 at $155.07, February live cattle are down $0.47 at $155.57, and April live cattle are down $0.20 at $159.72. Boxed beef prices are mixed: choice up $1.25 ($265.08) and select down $4.18 ($234.39) with a movement of 67 loads (35.08 loads of choice, 13.50 loads of select, 9.44 loads of trim and 8.53 loads of ground beef). FEEDER CATTLE: The feeder cattle complex seems to be reanalyzing Monday's move, and even though the live cattle complex is trading modestly lower and corn prices are trading steady to $0.03 higher into the afternoon, the feeder cattle complex is aiming to keep its market above the 100-day moving average and retake some of the position it lost Monday. The market is elated to see that early this week, boxed beef prices have been mostly supported, which could help the live cattle contracts' and feedlots' quest to keep prices at least steady this week. Feeder cattle sales through the New Year will be sparse, as most auction houses held their last sale of the year last week. Come the second week of January, however, interest should be hot. January feeders are up $1.50 at $183.60, March feeders are up $1.07 at $184.87 and April feeders are up $0.95 at $188.42. LEAN HOGS: The lean hog complex is heading into the noon hour mixed, as most of the nearby contracts are lower, while the deferred contracts are keeping a positive front. Pork cutout values were down sharp Monday afternoon, which could be the reason for some of the pressure in Tuesday's market. Traders would love nothing more than to see strong fundamental support in the hog complex with steady kills and ample support from the retail sector in restocking after the big holiday run -- but the market has yet to find that kind of support, and it won't likely come ahead of the Christmas holiday. February lean hogs are down $1.52 at $84.17, April lean hogs are down $).85 at $92.15, and June lean hogs are down $0.27 at $106.67. The projected lean hog index for 12/19/2022 is up $0.02 at $80.86, and the actual index for 12/16/2022 is down $0.71 at $80.84. Hog prices are lower on the Daily Direct Morning Hog Report, down $0.41 with a weighted average of $79.98, ranging from $78.00 to $81.00 on 4,641 head and a five-day rolling average of $80.36. Pork cutouts total 193.45 loads with 175.30 loads of pork cuts and 18.15 loads of trim. Pork cutout values: down $2.06, $82.87. ShayLe Stewart can be reached [email protected] (c) Copyright 2022 DTN, LLC. All rights reserved.