DTN Midday Livestock Comments          12/03 12:07

   Livestock Contracts Slide Lower

   Thursday's trade hasn't granted the livestock contracts any wishes as all 
three markets trade fully lower.

ShayLe Stewart
DTN Livestock Analyst

   General Comments

   The livestock sector hasn't warmed up as the day has continue to trade. The 
feeder cattle contracts are seeing the steepest losses though all contracts in 
the livestock arena are lower. There's been some more cash cattle trade at 
$110, which is starting to be this week's trend. March corn is up 2 1/2 cents 
per bushel and January soybean meal is up $5.20. The Dow Jones Industrial 
Average is up 171.38 points and NASDAQ is up 62.65 points.

   LIVE CATTLE

   The week isn't panning out as feedlots had hoped it would. A weaker board 
and cash cattle prices that pan out to be $1.00 lower to $1.00 higher, wasn't 
in mind for the week, but nevertheless, here we are. December live cattle are 
down $1.47 at $109.27, February live cattle are down $1.85 at $112.07 and April 
live cattle are down $1.47 at $115.70. Working against feedlot's aspirations to 
move the market higher is a topping boxed beef market as well. With choice and 
select cuts showing a slightly pullback, it would appear that a seasonal peak 
has been set. There has been some trade again Thursday morning in Texas: $110 
-- while the rest of the cattle country sits idly waiting for bids to be 
renewed.

   Beef net sales of 13,700 mt reported for 2020 were down noticeably from the 
previous week and down 16% from the prior 4-week average. The three primary 
increases were for Japan (7,200 mt, including decreases of 500 mt), South Korea 
(3,800 mt, including decreases of 400 mt) and Mexico (1,000 mt, including 
decreases of 100 mt).

   Boxed beef prices are lower: choice down $1.37 ($239.52) and select down 
$1.28 ($221.67) with a movement of 99 loads (60.92 loads of choice, 9.35 loads 
of select, 15.69 loads of trim and 12.85 loads of ground beef).

   FEEDER CATTLE

   A lack of trader support and the $0.03 rally in the corn market isn't 
lending the feeder cattle contracts any favors. January feeders are down $2.07 
at $139.72, March feeders are down $1.87 at $139.10 and April feeders are down 
$1.87 at $140.22. The market not only seems to have lost its recent gusto, but 
it also seems to be veering cautiously away from resistance levels.

   LEAN HOGS

   Back to scaling lower, the lean hog contracts dip lower into Thursday's 
afternoon. December lean hogs are down $0.35 at $66.00, February lean hogs are 
down $0.92 at $66.95 and April lean hogs are down $0.47 at $70.40. There was 
hope that Thursday's export report could have given the market some minor 
support, but the complex is set on trailing lower without any strong 
fundamental or technical factors aligning positively for the market.

   Pork net sales of 31,300 mt reported for 2020 were up 66% from the previous 
week, but down 6% from the prior four-week average. The three primary increases 
were Mexico (12,900 mt, including decreases of 1,000 mt), China (7,400 mt, 
including decreases of 1,300 mt) and Japan (4,200 mt, including decreases of 
300 mt).

   The projected lean hog index for 12/02/2020 is down $0.16 at $66.55 and the 
actual index for 12/01/2020 is up $0.04 at $66.71. Hog prices are lower on the 
National Direct Morning Hog Report, down $0.35 with a weighted average of 
$56.34, ranging from $54.00 to $56.75 on 4,516 head and a five-day rolling 
average of $56.44. Pork cutouts total 233.18 loads with 205.66 loads of pork 
cuts and 27.53 loads of trim. Pork cutout values: up $0.56, $80.42.

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

   **

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