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DTN Midday Livestock Comments          12/08 11:46

   Livestock Contracts Trade Weaker Wednesday 

   It's a hem-haw day for the livestock complex as bearish tones drift 
throughout the complex and support has yet to show up in any of the contracts. 

ShayLe Stewart
DTN Livestock Analyst


   Heading into Wednesday afternoon, the livestock contracts would like to see 
some support enter the marketplace; but at this point in time it's not looking 
like they are going to have their wishes granted. There hasn't been much 
interest arise in the cash cattle market and it wouldn't be surprising to see 
trade wait until Thursday to get underway. March corn is up 1 3/4 cents per 
bushel and January soybean meal is up $7.80. The Dow Jones Industrial Average 
is down 74.43 points and NASDAQ is up 32.36 points.


   Live cattle futures are continuing to chop mostly sideways throughout 
Wednesday trade with a bearish attitude pressuring the day. With boxes printing 
lower at noon and the futures market trading with a weaker undertone, the cash 
cattle market (though having regained substantial leverage) is going to see 
pushback from packers. December live cattle are down $0.45 at $137.77, February 
live cattle are down $0.12 at $139.10 and April live cattle are down $0.12 at 
$142.32. Bids of $220 have been offered in Nebraska, but otherwise the market 
hasn't seen much interest thus far. Asking prices are set at $144 to $145 in 
the Southern Plains, and in the North at $224. It wouldn't be unlikely to see 
trade remain mostly quiet throughout Wednesday and not gain much attention 
until Thursday, or potentially even Friday.

   The Fed Cattle Exchange Auction listed a total of 1,849 (Texas 1,386 head, 
Kansas 392 head, California 71 head head), none of which actually sold, as they 
did not meet the reserve prices, which ranged from $134 to $143.50. Opening 
prices ranged from $132 to $139; high bids ranged from $132.25 to $140

   Boxed beef prices are lower: choice down $0.79 ($267.24) and select down 
$1.10 ($254.58) with a movement of 83 loads (52.19 loads of choice, 12.50 loads 
of select, 7.18 loads of trim and 10.68 loads of ground beef).


   The corn market isn't pressuring the feeder cattle contracts, but without 
substantial support stemming from either the live cattle contracts or the cash 
cattle market, the feeder cattle contracts are trading modestly lower 
Wednesday. January feeders are down $1.25 at $163.77, March feeders are down 
$0.70 at $166.77 and April feeders are down $0.92 at $169.92. Sale barns only 
have this week and next before most head out for the remainder of the year to 
take some much-needed time off. With that being the case, sales are seeing 
large receipts this week and thus far they've been met with strong interest.


   The lean hog market's lower move has continued into Wednesday and is likely 
to continue throughout the afternoon. December lean hogs are down $1.07 at 
$71.00, February lean hogs are down $0.17 at $76.37 and April lean hogs are 
down $0.35 at $81.70. One of the most frustrating things about the current lean 
hog market is the back-and-forth nature of the cash and pork cutout values. The 
market is desperately seeking strong cues from both the technical and 
fundamental sides of the market to help everyone better understand the 
long-term trajectory. But with the market's daily knee-jerk reactions (sharply 
higher one day, sharply lower the next day) a clear vision for the market's 
outlook is hard to understand. And while hog producers yearn for a clear 
understanding of the market's path, it's likely this type of back-and-forth 
nature continues throughout the remainder of the year.

   The projected CME Lean Hog Index for 12/7/2021 is down $0.11 at $70.83, and 
the actual index for 12/06/2021 is up $0.16 at $70.94. Hog prices are lower on 
the National Direct Morning Hog Report, down $2.66 with a weighted average of 
$55.52, ranging from $55.00 to $61.00 on 3,860 head and a five-day rolling 
average of $57.09. Pork cutouts totaled 215.20 loads with 185.07 load of pork 
cuts and 30.13 loads of trim. Pork cutout

   ShayLe Stewart can be reached

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