DTN Midday Livestock Comments 01/17 12:07
Live Cattle Futures Maintain Moderate Morning Gains
Light to moderate buyer support is seen in cattle futures, which is helping
to draw additional support back into the complex. The focus on sustaining short
term momentum in front month February live cattle contracts may spark firm end
of the session gains.
By Rick Kment
DTN Livestock Analyst
Livestock futures are holding trade activity in a narrow range Tuesday
morning despite the firm buyer interest developing in nearby cattle futures.
The outside market commodity support is helping to bring spill over buying to
nearby cattle trade. Corn prices are lower in light trade. March corn futures
are 6 cents lower. Stock markets are lower in light trade. The Dow Jones is 45
points lower while Nasdaq is down 28 points.
Firm buyer support continues to hold in nearby live cattle futures trade as
the underlying support from outside commodity markets is helping to draw
unified buyer support to the complex. This is pushing front month futures
contracts 80 cents higher with prices starting to be established above $119 per
cwt. The potential exists to draw additional support back to the complex, but
there is likely needed to be firming support from fundamentals. Cash cattle
markets are quiet with no bids developing yet this week, and asking prices
generally quiet. A few asking prices have been suggested at $122 in the South
and $192 in the North, but it is likely going to be the second half of the week
before active trade develops. Overall show lists have become generally smaller
through the week, putting more emphasis on tight supplies. Beef cut-outs at
midday are mixed, $0.29 lower (select) and up $0.38 per cwt (choice) with light
movement of 52 total loads reported (31 loads of choice cuts, 13 loads of
select cuts, no loads of trimmings, 8 loads of ground beef).
Mixed trade is seen in feeder cattle futures with traders focusing on the
overall lack of buyer support seen during the morning. There continues to be
growing uneasiness concerning the wide ranging gains in commodity markets as
well as increased overall concern that trade interest may slow through the end
of the month. The lack of consistency in beef values in the morning report has
added even more uncertainty to deferred feeder cattle trade. Moderate gains of
60 to 80 cents are holding in spring contracts, while fall contracts are
holding narrow losses Tuesday morning.
Little movement has been seen through the entire lean hog complex with
prices once again mixed at midday. Narrow price shifts have developed through
the morning, but the inability to break out of the tightly grouped trading
ranges has limited overall activity levels and the interest of most buyers to
step back into the market. There may be some additional support seen through
the next couple of weeks as more focus is placed on overall hog numbers
available to the market. Cash prices are lower on the National Direct morning
cash hog report. The weighted average price fell $0.25 at $61.71 per cwt with
the range from $58.00 to $63.00 on 4,743 head reported sold. Cash prices are
lower on the Iowa Minnesota Direct morning cash hog report. The weighted
average price fell $0.07 at $62.84 per cwt with the range from $58.00 to $63.00
on 2,453 head reported sold. The National Pork Plant Report reported 168 loads
selling with prices falling $1.70 per cwt. Lean hog index for 1/13 is at $64.10
up $1.18 with a projected two-day index of $64.84 up $0.74.
Rick Kment can be reached at email@example.com
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