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DTN Midday Livestock Comments          09/21 12:13

   Livestock Contracts Lacking Trader Interest

   As the day passes by, Monday's trade throughout the livestock sector has 
been mostly quiet as the complex needs more trader action to move the 
marketplace higher.

ShayLe Stewart
DTN Livestock Analyst

   General Comments

   Trailing into Monday's afternoon trade, livestock contracts are still 
feeling pressured -- especially in the cattle sector. Some of the downward 
pressure is coming from lack of trader interest despite some strong incentives 
popping up Monday as corn prices are lower and current showlists fall in favor 
of cattle feeders. December corn is down 8 1/2 cents per bushel and December 
soybean meal is down $2.70. The Dow Jones Industrial Average is down 750.32 
points and NASDAQ is down 120.51 points.


   Live cattle contracts haven't been as favorable to this week's beginning as 
they were to last week's end. October live cattle are down $0.85 at $106.50, 
December live cattle are down $1.45 at $110.40 and February live cattle are 
down $1.17 at $114.90. As the market seems to be in left field, trading with 
minimal trader interest, the market is left with not other option but to scale 
lower. If the board ends up trading somewhat favorably to feeders, and Friday's 
Cattle on Feed report doesn't create too much of a stir in the marketplace, 
feedlots may be able to work a stronger (at least steady) market again this 
week. New showlists appear to be somewhat smaller in Texas, and lower in Kansas 
and Nebraska/Colorado.

   Last week's negotiated purchases totaled 105,118 head. Of that 84,204 head 
are committed for delivery in the next two weeks, while the remaining 20,914 
head are for delivery in the following 15 to 30 days.

   Boxed beef prices are higher: choice up $1.22 ($216.86) and select up $1.46 
($205.40) with a movement of 40 loads (26.40 loads of choice, 6.33 loads of 
select, 3.84 loads of trim and 3.70 loads of ground beef).


   The feeder cattle complex is balancing a tough market as there's pressure on 
the board at $144, willing the market to trade lower, and the demand throughout 
the countryside isn't even. Yearlings continue to sell for excellent prices (as 
they easily sold $3.00 to $4.00 higher last week), vaccinated and weaned 
spring-born calves are selling mostly steady but it's the bawling, unweaned 
calves that are pulling the market lower. September feeders are down $0.20 at 
$140.67, October feeders are down $0.87 at $141.55 and November feeders are 
down $1.02 at $141.50.


   Although the nearby lean hog contracts are feeling some pressure, the 
complex is still trading mostly sideways keeping in its holding pattern awhile 
looking for an export driver to again support the market. October lean hogs are 
down $0.42 at $66.07, December lean hogs are down $1.10 at $62.42 and February 
lean hogs are down $0.45 at $68.07. The market needs both fundamental and 
technical support to be able to sustain the levels the board's at now. The 
morning's cash trade was down slightly but on a considerable movement, and 
hopefully the cutout value will be able to carry into the day's close.

   The projected lean hog index for 9/18/2020 is up $1.71 at $71.29 and the 
actual index for 9/17/2020 is up $1.74 at $69.58. Hog prices are lower on the 
National Direct Morning Hog Report, down $0.13 with a weighted average of 
$60.86, ranging from $55.00 to $64.00 on 7,496 head and a five-day rolling 
average of $59.56. Pork cutouts total 160.81 loads with 135.29 loads of pork 
cuts and 25.52 loads of trim. Pork cutout values: up $3.09, $90.62.

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

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