Moderate to strong pressure quickly developed across the market Thursday morning. This lack of support limited trade interest in most contracts, but pushed prices lower early. The lack of follow through pressure midday has allowed for mixed trade to develop even though volume is light. Corn prices are lower in light trade. March corn futures are 1 cent per bushel lower. Stock markets are higher in light trade. The Dow Jones is 100 points higher while Nasdaq is up 47 points.
Narrow gains have slowly developed at midday with prices now seen from 5 cents lower to 15 cents per cwt higher. The focus on short covering appears to be gaining momentum through the morning with traders focusing on additional longer term support through the complex. It is uncertain just how much additional volume will step into the complex. The overall tone of all livestock markets remain weak, but the inability to spark additional selling activity may help to bring stability to all cattle trade. Cash cattle activity has redeveloped with moderate trade volume developing in the South. Live cattle trade is seen in these areas at $117 per cwt. This is $3 to $4 per cwt lower than last week's prices, and expected to generally set the tone of the market through the end of the week. Bids are seen in the North at $186 to $187 per cwt, although no sales have redeveloped following midweek trade. Asking prices through the morning have ben at $118 to $120 live basis and $190 and higher dressed. Beef cut-outs at midday are mixed, $0.14 higher (select) and down $1.24 per cwt (choice) with light movement of 64 total loads reported (41 loads of choice cuts, 18 loads of select cuts, no loads of trimmings, 5 loads of ground beef).
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Feeder cattle futures have broken away from the early pressure developing across the complex Thursday morning. This is allowing for increased stability despite the focus that overall market fundamentals remain weak and follow through liquidation could redevelop. But the aggressive $8 to $10 per cwt selloff in nearby contracts in the last week has led to market apathy as most sellers have liquidated needed positions, while buyers are unwilling to aggressively step back into the market. Prices are mixed from 70 cents lower to 10 cents higher, although the overall tone of the market remains weak.
Moderate to strong market pressure is seen through morning trade with prices generally 60 cents to $1.10 per cwt lower at midday. The early pressure in cattle trade as well as pressure from cash hog values is adding to the liquidation activity through the week. With prices breaking below late November market pullbacks, this sets the next support level at the November lows seen earlier in the month of November. At this point, current market prices are still nearly $2 per cwt above these levels in nearby contracts, but continued pressure could quickly erode market support seen earlier in the month. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is down $0.77 at $58.05 per cwt with the range from $53.00 to $60.00 on 5,610 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price fell $1.35 at $57.46 per cwt with the range from $53.00 to $60.00 on 3,710 head reported sold. The National Pork Plant Report posted 155 loads selling with carcass values gaining $0.79 per cwt. Lean hog index for 12/04 is at $64.35 up $0.43 with a projected two-day index of $64.85, up $0.50.
Rick Kment can be reached at email@example.com
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