DTN Midday Livestock Comments 10/17 11:48
Strong Losses Develop Midweek
Pressure is seen in all livestock futures trade. This has focused morning
selling pressure on nearby lean hog futures with spot month contracts trading
$1.70 per cwt lower. The lack of buyer interest in the market is expected to
add to underlying weakness through the entire complex.
By Rick Kment
Firm pressure has been seen through the entire livestock complex through the
morning with triple-digit losses seen in lean hog and feeder cattle trade. The
lack of buyer support returning to the complex could spark some additional
underlying through the remainder of the week. Corn markets are lower in light
trade. December corn futures are 1/2 cent lower. Stock markets are mixed in
light trade. The Dow Jones is 1 point higher while Nasdaq is down 1 point.
Mixed trade is seen midday Wednesday with October futures holding a 17 cent
per cwt gain, while all other contracts are firmly lower. The underlying
pressure that is developing in feeder cattle trade has sparked some additional
weakness through the entire cattle complex. Limited market activity is expected
to be seen through the end of the session, with prices likely to hold current
trading ranges. Cash cattle interest remains sluggish with a few bids seen in
the North. Live bids are seen at $110 while dressed bids are $172 to $174 per
cwt. Asking prices are still hard to firmly pin down, but have been heard
around $114 live basis in the South. Active trade is likely to not develop
until late in the week. Boxed Beef cut-outs at midday are mixed, $1.02 lower
(select) and up $0.22 per cwt (choice) with moderate movement of 103 total
loads reported (55 loads of choice cuts, 19 loads of select cuts, 13 loads of
trimmings, 15 loads of ground beef).
October feeder cattle futures are holding a single-digit gain at midday,
although strong losses near $1 per cwt are seen through the rest of the
complex. This is adding to the overall uncertainty through the complex, with
traders looking for additional direction through the entire cattle market.
January through April futures are holding triple digit losses with the overall
pressure focusing on general market weakness through the entire feeder cattle
Triple-digit losses have quickly moved into nearby lean hog futures with
December contracts setting the tone for the lower moving markets with prices
$1.70 per cwt lower. Traders still remain focused on outside market direction
and recent shifts in fundamentals. This could add even more weakness later in
the week. Cash prices are lower on the National Direct morning cash hog report.
The weighted average price is $0.52 lower at $59.40 per cwt with the range from
$53.00 to $61.00 on 6,425 head reported sold. Cash prices are lower on the
Iowa/Minnesota Direct morning cash hog report. The weighted average price is
$1.94 lower at $57.82 per cwt with the range from $55.00 to $60.50 on 1,255
head reported sold. The National Pork Plant Report posted 244 loads selling on
the morning report. Pork carcass values fell $1.37 per cwt at $79.50 per cwt.
Lean hog index for 10/15 is at $68.59 down $0.16 with a projected two-day index
of $68.17, down $0.42.
Rick Kment can be reached at email@example.com
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