Hogs
Price action: October lean hogs fell $1.725 to $93.825, nearer the daily low.
Fundamental analysis: The lean hog futures market today saw routine profit taking from the speculators after prices Tuesday hit a nine-week high.
Cash hog market fundamentals are weakening a bit late this summer. The latest CME lean hog index (Aug. 29) is down 25 cents to $105.92. Thursday’s projected CME cash index price (for Sept. 2) is unchanged at $105.92. Today’s national direct 5-day rolling average cash hog price quote is $105.75. The noon report today showed pork cutout value up $1.10 to $115.22, on gains in loins and bellies. Movement at midday was solid at 262.89 loads.
Technical analysis: Lean hog futures bulls still have the solid overall near-term technical advantage. A choppy, 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 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 $95.00 and then at this week’s high of $96.00. First support is seen at $93.00 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 $1.20 to $238.325, near mid-range. September feeder cattle fell $2.175 to $362.075, near mid-range.
Fundamental analysis: The cattle futures markets today saw some routine profit-taking pressure. Losses were limited as cash cattle and beef market fundamentals remain overall bullish. It’s likely the speculator cattle futures traders this week are somewhat hesitant to play the long sides due to some keener uncertainty in the general marketplace.
Very light cash cattle trading has occurred so far this week, according to USDA, with steers fetching an average of $242.00. Yesterday USDA reported the cash cattle price last week at $243.60. The noon report today showed Choice-grade boxed beef cutout value up $2.63 to $416.05, with Select-grade up $1.59 to $387.76. Movement at midday was good at 71 loads. The Choice-Select spread is presently $28.29.
Technical analysis: Live and feeder cattle futures bulls have the strong overall near-term technical advantage. Prices are in nine-week-old uptrends on the daily bar charts. The next upside price objective for the live cattle bulls is to close October futures above resistance at $245.00. The next downside technical objective for the bears is closing prices below solid technical support at $232.50. First resistance is seen at the contract high of $242.075 and then at $243.00. First support is seen at $235.95 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 last week’s low of $354.525. First resistance is seen at today’s high of $364.20 and then at this week’s high of $367.70. First support is seen at $360.00 and then at $359.05.
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.