DTN Midday Livestock Comments 01/20 11:18

DTN Midday Livestock Comments 01/20 11:18 Livestock Trade Higher Friday, Helped by Increased Export Sales Active futures contracts for live cattle, feeders and lean hogs were all trading higher at midday Friday, trimming back losses for the week with help from a higher showing of beef and pork export sales in the latest week. Todd Hultman DTN Lead Analyst GENERAL COMMENTS: After a rough week of bearish economic news weighing on livestock prices, cattle and hog futures are off to a higher start with help from Friday morning's higher export sales for beef and pork. March corn is steady and March soybean meal is down $4.90. The Dow Jones Industrial Average is up 112 points. LIVE CATTLE: Live cattle futures are higher at midday Friday with the April contract up $0.47 at $159.60. Even though prices are on track for a lower week, they appear to have support near their lowest levels in a month and above the 100-day average at $158.50. USDA's report of 17,300 mt of beef export sales for last week may have sparked some of the buying. Excluding last week's sales transferred into the new year, Friday's weekly total was the highest since late September. Cash trade is finding more takers Friday at roughly $155 in the South, while trade remains quiet in the North with some earlier trades near $258, roughly $3 lower. The slaughter pace has been a little lighter this week but remains active with 126,000 cattle estimated Friday. Friday afternoon's cattle on-feed report is expecting roughly 11.65 million head on feed as of January 1, down 3% from a year ago with placements down 8% from a year ago. Anything close to the estimates should serve as reminders of cattle being less available this year and more difficult for packers to obtain without bidding prices higher. Choice boxed beef prices were up $0.19 at $271.70 early Friday, but are down nearly $5.00 on the week. Selects were up $1.47 to $257.16, slightly higher on the week. USDA reported 77 total loads early Friday. FEEDER CATTLE: March feeder cattle are higher at midmorning Friday, near $181.00 after having fallen this week to near $180 and their lowest prices in three months. March corn is roughly steady Friday and slightly higher after good-to-excellent crop ratings in Argentina fell even further Thursday, to 5%. Some of this week's selling pressure came from outside markets where weak economic data added to selling in the stock market and fed concerns about a possible recession ahead. The main bearish pressure weight feeder prices, however, continues to come from high feed costs, made worse by the past two years of western drought. The CME Feeder Index for Wednesday posted at $177.87, down $4.49 from a week ago. LEAN HOGS: At midmorning Friday, hog futures are getting a bounce higher with April hogs up $1.37 at $85.77. Hog futures are still looking at a lower close on the week but found willing buyers after Thursday's prices fell to $84.40, their lowest close in three months. Part of Friday's buying enthusiasm was likely sparked by USDA's report of 34,100 mt of pork export sales to Mexico, Canada and even China. China's purchase of 4,100 mt of pork last week suggests they may have problems distributing their own pork supplies during this time of rampant problems with COVID. Also adding to the bullish mood, USDA's morning pork report posted cutouts up $3.30 at $82.87 with help from an $18.03 gain in bellies. If the value can hold, it will achieve a small gain on the week. USDA reported 162.18 loads of pork cuts and 30.20 loads of trim. Despite Friday's buying enthusiasm, the recent cash trade in U.S. hogs suggests inventory is easily available for packers, regardless of what the December USDA report said. CME's Lean Hog Index was projected at 73.28 for Wednesday, down $2.21 from a week ago. The Daily Direct Morning Hog Report showed a national negotiated price of $70.40, a little below the swine/pork formula price of $71.31. Slaughter has remained active this week with Dow Jones estimating 482,000 Friday. Todd Hultman can be reached at [email protected] Follow him on Twitter @ToddHultman1 (c) Copyright 2023 DTN, LLC. All rights reserved.