DTN Midday Livestock Comments

GENERAL COMMENTS:

Strong gains are holding strong underlying support across all markets with triple digit gains swiftly moving into the market despite the weak opening moves. This is helping to spark some underlying buyer support in most contracts. Corn prices are mixed in light trade. March corn futures are 3/4 cent lower Monday. Stock markets are higher in light trade. The Dow Jones is 251 points higher while Nasdaq is up 70 points.

LIVE CATTLE:

Triple-digit gains are seen in live cattle trade early Monday morning following the inability for renewed selling pressure to hold prices lower once again. There is growing uncertainty as to just how much additional price weakness can develop given the firm moves in beef values. Nearby gains are hovering near $1 per cwt higher, which is helping to build additional confidence through the complex. Cash cattle activity remains at a standstill at this point with show list distribution earlier in the morning and inventory taking the main focus. There is likely not going to be any bids through the rest of the day and possibly on Tuesday. Boxed Beef cut-outs at midday are higher, $0.47 higher (select) and up $0.48 per cwt (choice) with light movement of 47 total loads reported (24 loads of choice cuts, 10 loads of select cuts, 7 loads of trimmings, 6 loads of ground beef).

FEEDER CATTLE:

Feeder cattle futures are leading the market higher with traders focusing on increased overall buyer support. There is growing activity focusing on the ability to draw traders back to the complex. This has pushed nearby contracts near $1.50 per cwt higher as the focus on retracting sharp losses last week has helped to bring increased trade volume to the market.

LEAN HOGS:

Strong complex-wide support is seen in lean hog futures. This is helping to bring commercial traders back to the market in order to help push prices off of recent lows. Triple-digit gains are seen in nearby futures, with most contracts hovering near the $1 per cwt mark at midday. Follow through buying is expected to be seen through most of the afternoon. Cash prices are higher on the National Direct morning cash hog report. The weighted average price is up $0.35 at $62.42 per cwt with the range from $56.00 to $62.58 on 3,753 head reported sold. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. The National Pork Plant Report posted 193 loads selling with carcass values gaining $0.97 per cwt. Lean hog index for 3/1 is at $68.09, down 0.27 with a projected two-day index of $67.69, down 0.40.

Rick Kment can be reached at rick.kment@dtn.com

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