Hogs
Price action: October lean hogs fell 87 1/2 cents to $95.15, near the daily low.
Fundamental analysis: The lean hog futures market today saw routine profit-taking pressure after prices Friday hit a nine-week high.
The latest CME lean hog index is down a nickel to $105.92 as of Sept. 4. Tuesday’s projected cash hog index is down a penny to $105.91. Today’s national direct 5-day rolling average cash hog price quote is $105.14.
The noon report today showed pork cutout value rose $1.25 to $117.12, led by gains in picnics. Movement at midday was 165.52 loads.
Technical analysis: Lean hog futures bulls still have the solid overall near-term technical advantage. A choppy, seven-week-old price uptrend is in place on the daily bar chart. The next upside price objective for the hog bulls is to close October futures prices above solid chart resistance at the contract high of $97.05. The next downside price objective for the bears is closing prices below solid technical support at $91.00. First resistance is seen at today’s high of $96.375 and then at $97.05. First support is seen at last week’s low of $93.75 and then at $92.00.
What to do: Get current with feed coverage.
Hedgers: You are carrying all production risk in the cash market.
Feed needs: You should have all your soymeal needs covered through September in the cash market, with half coverage for October, November and December. For corn, you now have all needs through October covered in the cash market.
Cattle
Price action: October live cattle fell 17 1/2 cents to $235.80 and near mid-range. September feeder cattle rose $1.125 to $360.95, near mid-range.
Fundamental analysis: The live cattle futures markets saw some buying support early from overall bullish cash cattle and beef market fundamentals. However, some profit-taking selling interest occurred in late trading to knock live and feeder cattle futures down from their daily highs.
USDA today reported last week’s cash cattle trade averaged $242.55, which compares to $243.60 the week prior. The noon report today showed wholesale boxed beef cutout values firmer, with Choice up 82 cents to $411.58, while Select gained $2.28 to $387.47. Movement at midday was light at 46 loads. The Choice-Select spread is presently $24.11.
Technical analysis: Live and feeder cattle futures bulls have the solid overall near-term technical advantage. However, nine-week-old price uptrends on the daily bar charts may now be rolling over. The next upside price objective for the live cattle bulls is to close October futures above resistance at the contract high of $242.075. The next downside technical objective for the bears is closing prices below solid technical support at $230.00. First resistance is seen at $237.00 and then at $239.00. First support is seen at last week’s low of $235.15 and then at $234.00.
The next upside price objective for the feeder bulls is to close September futures prices above technical resistance at the contract high of $370.00. The next downside price objective for the bears is to close prices below solid technical support at $354.525. First resistance is seen at $364.00 and then at $365.00. First support is seen at last week’s low of $357.30 and then at $356.00.
What to do: Get current with feed coverage. Carry all production risk in the cash market for now.
Hedgers: Carry all production risk in the cash market for now.
Feed needs: For soymeal, you have full coverage in cash through July, with half of your needs for August, September, October, November and December covered in cash. For corn, you have all needs through August covered in the cash market, with half of your needs for September and October covered in cash.