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DTN Midday Livestock Comments          10/22 12:12

   Livestock Contracts Bear Lower

   It's a lower-pressured day of the livestock complex as all three markets 
scale to weaker prices.

ShayLe Stewart
DTN Livestock Analyst

   General Comments

   Thursday hasn't granted the livestock complex any favors as all three 
contracts continue to trade lower into today's afternoon hours. A bearish 
mindset as taken over the market as traders are leery of supporting the 
livestock contracts and consequently the markets are scaling lower. December 
corn is up 2 cents per bushel and December soybean meal is up $6.90. The Dow 
Jones Industrial Average is down 14.41 points and NASDAQ is down 52.99 points.


   The live cattle complex is tipping lower as bearish pressure continues to 
overwhelm the market. December live cattle are down $1.05 at $103.52, February 
live cattle are down $1.32 at $106.75 and April live cattle are down $1.00 at 
$109.87. As the board slides lower, the cash cattle market sits idly as bids 
are obsolete. Earlier this week Northern dressed deals ranged from $163 to 
$165, which is mostly $3.00 to $4.00 lower than last week. Southern cattle have 
traded for mostly $106, which is mostly $2.00 lower than last week.

   Beef net sales of 21,700 MT reported for 2020 were up 62% from the previous 
week and 13% from the prior four-week average.  The three biggest buyers were 
South Korea (5,400 mt, including decreases of 400 mt), China (3,700 mt) and 
Japan (3,600 mt, including decreases of 600 mt).

   Boxed beef prices are higher: choice up $1.05 ($209.52) and select up $1.03 
($191.94) with a movement of 73 loads (38.81 loads of choice, 20.77 loads of 
select, 5.34 loads of trim and 7.63 loads of ground beef).


   Trading in a sideways pattern from Monday's new low, the feeder cattle 
market hasn't been gifted any bullish favors to give the market any reason to 
trade higher. November feeders are down $0.75 at $130.45, January feeders are 
down $1.10 at $125.97 and March feeders are down $1.12 at $126.02. Calves 
continue to sell at lower prices as the market is pressured to trade lower as 
supply outweighs demand and buyers must look at the nation's corn prices and 
keep break-even levels in check. Calves without a vaccination program and that 
haven't been long weaned are selling anywhere from $0.08 to $0.12 back from 
last week.


   The lean hog market was hopeful for a strong export report, but the outcome 
was unsatisfying and leaves the market trading fully lower. December lean hogs 
are down $2.72 at $66.47, February lean hogs are down $1.37 at $67.07 and April 
lean hogs are down $1.35 at $69.45. As the market continues to weigh the 
factors within the industry - the lower export report and decline in cash 
prices aren't surprising, but thankfully the continued support for pork within 
U.S. consumers has helped feel pork cutout values elevated.

   The projected lean hog index for 10/21/2020 is up $0.09 at $78.60 and the 
actual index for 10/20/2020 is up $0.07 at $0.07 at $78.69. Hog prices are 
lower on the National Direct Morning Hog Report, down $3.53 with a weighted 
average of $59.80, ranging from $56.00 to $65.00 on 4,410 head and a five-day 
rolling average of $60.31. Pork cutouts total 207.23 loads with 160.56 loads of 
pork cuts and 46.67 loads of trim. Pork cutout values: up $3.99, $102.15.

   Pork net sales of 26,800 mt reported for 2020 were unchanged from the 
previous week, but down 35% from the prior four-week average.  The three 
biggest buyers were Mexico (13,800 mt, including decreases of 800 mt), Japan 
(4,900 mt, including decreases of 200 mt) and China (1,800 mt, including 
decreases of 1,500 mt).

   ShayLe Stewart can be reached

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