Allendale Livestock Wrap-Up for 11/4/2009
Hogs: While there is nowhere near as much of an impact on hog marketings during harvest time there is perhaps a slight relationship left. Active harvesting may delay marketings among family based grain/hog farms. The result is cash hog prices were stronger today. Wholesale pork also posted a moderate increase. If harvest slows due to weather next week we could see moderate pressure. Though producers are showing more interest in hedging we are still holding off from recommendations for now.
Cattle: It was good to see December futures hold the line at about the same point the previous three days of action had. There is still a string or two of cattle moving in the south at $88 but most areas are still not moving numbers yet. Officially bids are now $87, except for the area noted above, while feedlots have asking prices at $90. The key issue on the supply front is that active fall placements will pick up the slaughter pace in the second half of December. On the demand front, we will get a new reading on employment on Friday. Futures are in a trading range and a breakout in either direction could move the market several dollars in the direction of breakout.
Rich Nelson is Director of Research at Allendale, Inc. in McHenry, IL. Allendale is registered with the CFTC and NFA and is a member of the NIBA. www.allendale-inc.com
