DTN Midday Livestock Comments

GENERAL COMMENTS:

Firm buyer activity has moved back into the cattle market with moderate gains seen in both live cattle and feeder cattle trade. The overall support through the complex is helping to bring additional underlying support through the complex as traders look for potential long-term market support to redevelop over the next couple of weeks. Corn prices are higher in light trade. September corn futures are 2 cents higher. Stock markets are higher in light trade. The Dow Jones is 79 points higher, while the Nasdaq is up 16 points.

LIVE CATTLE:

Light-to-moderate trade is seen in live cattle futures with buyers holding nearby contracts 40 to 50 cents higher at midday. The ability to focus on renewed commercial buyer support through the middle of the week is helping to spark some increased buyer activity through the end of the trading session. Cash cattle activity remains generally sluggish with token bids starting to slowly develop Wednesday morning. Light bids of $102 are seen in parts of Kansas, while the rest of the market remains undeveloped at this point. Asking prices are seen around $107 to $108 live basis and $168 to $170 dressed, but at this point are not expected to move anywhere significant over the near term. The Fed Cattle Exchange Auction report Wednesday listed a total of 1,240 head, with 125 actually sold (with the weighted average price of $163.00), 1,016 head listed as unsold, and 99 head listed as PO. The state-by-state breakdown looks like this: KS 442 total head, with 0 head sold, 343 head unsold, 99 head listed as PO ($103.25); NE 221 total head, with 0 head sold, 221 head unsold, and 0 head listed as PO; TX 412 total head, with 0 head sold, 412 head unsold, and 0 head listed as PO; CO no cattle reported in this area; IA no cattle reported in this area; other states (SD, MO) 165 total head, with 125 head sold (SD) at $163.00, 40 head unsold, and 0 head listed as PO. The delivery date/weighted averages breakdown is as listed: 1-9 day delivery: 680 head total (live), no sales; 1-17 day delivery 174 head total (live), no sales; 1-17 day delivery 346 head total (dressed), 125 head sold, with a weighted average price of $163.00; 1-17 day delivery 40 head total (Holsteins), no sales. Beef cut-outs at midday are higher, $0.24 higher (select) and up $0.43 per cwt (choice) with light movement of 107 total loads reported (56 loads of choice cuts, 17 loads of select cuts, 9 loads of trimmings, 26 loads of ground beef).

FEEDER CATTLE:

Feeder cattle futures have posted strong gains as firm commercial buyer support is slowly developing in nearby live and feeder cattle contracts. This is helping to place the focus on front-month September contracts with gains at 90 cents per cwt as the market is trying to create some stability following the Labor Day holiday weekend. This could bring about increased market support as firm beef values are helping to bring increased focus on market activity in all contracts.

LEAN HOGS:

Narrow trading ranges have been seen through the entire morning Wednesday with prices hovering between 12 cents lower and 15 cents higher in most contract months. The aggressive support over the last couple trading sessions has allowed for increased market stability in order for traders to catch their breath and square positions through the middle of the week. Very light trade volume is expected to be seen through the end of the session. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.49 at $61.44 per cwt with the range from $56.50 to $64.50 on 12,077 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price fell $0.06 at $62.11 per cwt with the range from $57 to $64 on 5,864 head reported sold. The National Pork Plant Report reported 246 loads selling with prices falling $1.87 per cwt. Lean hog index for 9/1 is at $71.36 down $1.03 with a projected two-day index of $70.33, down $1.03.

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

(BE)

Copyright 2017 DTN/The Progressive Farmer. All rights reserved.