Livestock Analysis | Sept. 30, 2024

Livestock Analysis

Livestock Analysis
Livestock Analysis | Sept. 30, 2024
(Pro Farmer)

Hogs

Price action: December lean hogs fell 10 cents to $73.275 and nearer the session high.

Fundamental analysis: The lean hog futures market has recently paused after decent gains through most of September. Buying interest in futures has been limited by fading cash hog and pork market fundamentals.

The latest CME lean hog index is down 4 cents to $84.03 as of Sept. 26 and marking a new seasonal low. Tuesday’s projected cash index price is down 2 cents at $84.01. Today’s national direct five-day rolling average cash hog price quote at $76.35. The noon report today showed pork cutout value rose $1.04 to $95.79, on gains in loins and bellies. Movement at midday was good at 130.02 loads.

The lean hog market bulls are hoping cash and futures prices will get a boost in the next few weeks as October is national pork month, which is expected to see grocer’s feature pork cuts more at the meat counter.

Technical analysis: The lean hog futures bulls have the overall near-term technical advantage. A six-week-old price uptrend is in place on the daily bar chart. The next upside price objective for the hog bulls is to close December prices above solid chart resistance at the May high of $77.725. The next downside price objective for the bears is closing prices below solid technical support at the September low of $70.55. First resistance is seen at $75.00 and then at $76.00. First support is seen at today’s low of $72.40 and then at $71.00.

What to do: Carry all production risk in the cash market for now.

Hedgers: Carry all risk in the cash market for now.

Feed needs: You are hand-to-mouth on corn-for-feed and soymeal needs.

Cattle

Price action: December live cattle rose 32 1/2 cents to $184.80 and nearer the session high. November feeder cattle fell 80 cents to $244.90 and nearer the session low. Both markets last Friday hit two-month highs.

Fundamental analysis: The cattle futures markets today saw a pause and some chart consolidation following recent good gains. A rally in December corn futures to a three-month high did put some price pressure on the feeder cattle futures.

Cash cattle and beef market fundamentals still favor the bullish camps. Cash cattle last week traded higher for a third straight week, averaging $186.15, which is up $2.14 from the week prior. Cash cattle trade ideas early this week see mixed opinions so far. Some are looking for higher prices again, while others feel recent solid purchases by packers, negative cutting margins and a fresh supply of contracted cattle at the start of the new month will halt cash market advances.

Today’s noon report showed Choice-grade boxed prices rose 78 cents to $297.47, while Select was up $1.18 to $283.26, taking the Choice/Select spread to $14.21. Movement at midday was light at 63 loads.

Technical analysis: The live and feeder cattle futures bulls have the overall near-term technical advantage amid steep three-week-old price uptrends in place on the daily bar charts. The next upside price objective for the live cattle bulls is to close December futures above solid resistance at $187.50. The next downside technical objective for the bears is closing prices below solid technical support at $180.00. First resistance is seen at last week’s high of $185.60 and then at $187.00. First support is seen at today’s low of $183.975 and then at $183.00. The next upside price objective for the feeder bulls is to close November futures prices above technical resistance at $250.00. The next downside price objective for the bears is to close prices below solid technical support at $237.50. First resistance is seen at last week’s high of $247.00 and then at $248.00. First support is seen at $244.00 and then at $243.00.

What to do: Carry all production risk in the cash market for now.

Hedgers: Carry all production risk in the cash market for now.

Feed needs: You are hand-to-mouth on corn-for-feed and soymeal needs.