DTN Midday Livestock Comments

GENERAL COMMENTS:

Livestock futures are mixed Friday morning with moderate to firm losses developing in cattle trade following the aggressive triple digit turn lower Thursday. Lean hog futures are holding moderate to firm gains with the most significant pullback seen in front month contracts. Corn prices are lower in light trade. March corn futures are 3 cents lower. Stock markets are lower in light trade. The Dow Jones is 20 points lower while Nasdaq is down 2 points.

LIVE CATTLE:

Live cattle futures are holding moderate losses from 40 to 60 cents per cwt. The overall pressure in the complex continues to draw additional trade into the market at midday, although there is also expected to be additional adjustments in the last hour of trade in front of the cattle on feed report. This could swing prices even further with the weaker tone seen in the market. But trade volume and actual contracts traded is likely to still remain light. Cash cattle activity is quiet Friday at midday with bids developing across the north through the morning. Bids are seen at $120 live basis and $193 dressed basis. It appears that there may not be active trade through the rest of the week, but the potential that sales will develop after the cattle on feed report remains a possibility. Beef cut-outs at midday are higher, $0.14 higher (select) and up $0.69 per cwt (choice) with light movement of 50 total loads reported (29 loads of choice cuts, 9 loads of select cuts, no loads of trimmings, 12 loads of ground beef).

FEEDER CATTLE:

Moderate price pressure is developing across the complex which is adding to the softness seen Thursday. Traders are holding nearby contracts 30 to 45 cents per cwt lower as traders remain focused on the lack of buyer interest in the market and lack of interest at this point. Cattle on feed reports will be released Friday afternoon, which could bring about some late-day position adjustments in front of the report.

LEAN HOGS:

Moderate to firm support is holding in nearby lean hog futures Friday morning and this support is helping to carry buyer support through much of the rest of the complex. February futures are holding a 57 cent gain, as the overall tone of the market still remains soft given the pressure in the trade Thursday. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.87 at $62.49 per cwt with the range from $59.00 to $65.25 on 2,259 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 157 loads selling with prices gaining $0.40 per cwt. Lean hog index for 1/20 is at $67.03 up $0.02 with a projected two-day index of $67.20 up $0.17.

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

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