DTN Closing Livestock Comments

Lean Hog Futures Slump Lower on Close, Surrendering Much of Early Week Rally

(DTN file photo)

Closing Comments

The cash cattle trade was not tested Friday with buyers and sellers apparently content with business levels generated on Wednesday. Having said that, trade volume totals for the week look no better than moderate. The national hog base closed off $0.92 compared with the prior day settlement ($60.50-$67.50, weighted average $65.43). From Friday to Friday, livestock futures scored the following changes: Apr LC Up $1.72; Jun LC up $2.17; Mar FC Up $3.85; May FC Up $4.60; Apr LH Up $0.88; May LH Up $0.72. Corn futures closed 1 to 2 cents higher at the conclusion of a lackluster session. Corn prices managed to bounce off of last week's lows, but not by much. The stock market closed mixed with the Dow off 19 points and the NASDAQ finishing about steady.

LIVE CATTLE

Futures closed mostly moderately higher, up 52 to off 20. Spot April closed near the top of a lateral trading range held since mid-January. Buying was linked to feedlot premiums and some technical progress. Although spot April stopped short of its January high, the June contract scored its best finish since early last summer. Beef cut-outs: firm to higher (Choice, $223.43 up $1.07, Select $214.48 up $0.61) moderate demand and offerings (47 loads of choice cuts, 27 loads of select cuts, 03 loads of trimmings, 21 loads of coarse grinds).

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MONDAY'S CASH CATTLE CALL:

Steady to $2.00 higher. Monday will be typically limited to the distribution of new showlists. We expect the new offering to be steady to somewhat larger. Preliminary asking prices should be around $130.00-plus in the South and $212.00-$214.00 in the North.

FEEDER CATTLE

Futures closed higher up 20-107. For the first time in months, feeder futures continued to charge ahead of the cash index. Spot March closed at its highest level since Aug. 22. Note that the cash index finally seems to be coming alive, supported both by feedlot demand and summer stocking plans. CME cash feeder index: 03/16: $129.27, up $1.05.

LEAN HOGS

Futures closed mostly sharply lower off 40-135. Although lean issues started the week with a good head of steam, the board eroded past mid-week, pressured by more defensive fundamentals. April through August closed Friday below 40-day moving averages, suggesting that next week's business could face additional technical selling. Pork cut-out: $81.60 (FOB Plant) up $0.26. CME cash lean 03/15: $71.84, off $0.15 (DTN Projected lean index for 03/16: $71.74, off $0.10).

MONDAY'S CASH HOG CALL

Steady. Look for cash hog buyers to resume procurement chores on Monday with generally steady bids.

For more from John, see http://www.feelofthemarket.com/…

(ES)

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