DTN Midday Livestock Comments 02/17 11:51
Livestock Futures Follow Strong Buyer Support in Live Cattle Complex
Triple-digit gains have quickly developed in nearby live cattle futures. The
overall tone of the market remains firm across all markets as end of the week
positioning is also developing.
By Rick Kment
Live cattle futures have posted strong triple digit gains through the
morning Friday with April futures leading the complex higher with gains
exceeding $1.50 per cwt. This rally is helping to spark additional buyer
support in both feeder cattle and lean hog markets. Corn prices are lower in
light trade. March corn futures are 3 cents lower. Stock markets are mixed in
light trade. The Dow Jones is 62 points lower while Nasdaq is up 3 points.
Sharp triple-digit gains are seen in live cattle futures with traders
focusing on strong commercial buyer activity moving back into the market.
February futures are holding a $1.37 per cwt rally at midday while April
futures are leading the market higher with a $1.62 cent per cwt rally. The
building support seen in the complex continues to focus on uncertain
fundamental support, but active commercial activity based on the potential for
follow through buyer interest next week. Cash cattle quickly developed through
the morning with prices generally steady with last week price levels. The
lion's share of trade is expected to be done for the week, with prices already
established even on expected clean-up trade that may develop. Prices in the
South are $119 to $120 per cwt with most late trade seen at $120 per cwt.
Dressed trade in the North is seen at $190 per cwt. It is still uncertain just
how many cattle traded through the morning Friday, but the ability to draw
trade early in the session and not drag it out through the rest of the day is
impressive. Beef cut-outs at midday are higher, $1.12 higher (select) and up
$1.15 per cwt (choice) with moderate movement of 89 total loads reported (61
loads of choice cuts, 11 loads of select cuts, 2 loads of trimmings, 15 loads
of ground beef).
Feeder cattle futures have bounced higher midday following the strong
support in live cattle futures as well as steady cash cattle trade which is
helping to build some needed stability into the market following the price
shifts seen through the week. Nearby contracts are holding gains of 30 to 70
cents per cwt as traders remain focused on the ability to draw increased market
support back into the complex.
Firm buyer support is seen through nearby and most deferred lean hog futures
following the firmness in pork values and spillover support seen across the
live cattle market. Nearby trade is seen from 50 to 75 cents per cwt higher at
midday, as traders continue to draw underlying support back into the market at
the end of the week. Sharp losses seen Thursday are being retracted more based
on additional trade volume rather than any shift in overall fundamental market
direction. Deferred futures remain lightly traded and generally weak, but the
focus on nearby gains is driving most trader activity. Cash prices are lower on
the National Direct morning cash hog report. The weighted average price fell
$1.46 at $71.83 per cwt with the range from $68.00 to $74.25 on 4,272 head
reported sold. Cash prices are unreported due to confidentiality on the Iowa
Minnesota Direct morning cash hog report. The National Pork Plant Report
reported 128 loads selling with prices up $0.78 per cwt. Lean hog index for
2/14 is at $75.31 up $0.69 with a projected two-day index of $75.98 up $0.67.
Rick Kment can be reached at firstname.lastname@example.org
Copyright 2017 DTN/The Progressive Farmer. All rights reserved.
DTN offers additional daily information available free through DTN Snapshot – sign up