Strong pressure in lean hog futures is causing triple-digit losses to develop in most nearby contracts. This is being offset by firm buyer support moving back into the feeder cattle complex. Overall sluggish market volume is likely to keep prices in current ranges through the rest of the day. Corn prices are lower in light trade Monday. July corn futures are 9 cents lower. Stock markets are lower in light trade. The Dow Jones is 108 points lower while Nasdaq is down 11 points.
Limited activity is seen in live cattle trade with narrow price shifts seen from 15 cents lower to 20 cents higher in most contracts at midday. The inability to bring back aggressive buyer support following the limit-higher gains seen Friday is causing some uncertainty in the market. Overall sluggish volume is seen early in the week, but this is expected surrounding the holiday that will keep markets closed Wednesday. A combination of traders absent from the market ahead of the holiday and some opting to extend the holiday into the upcoming weekend will keep market activity sluggish through most of the week. Cash markets remain sluggish with bids and asking prices undefined. It is expected that very little definition will be seen until late in the week after traders return from the holiday. Boxed Beef cut-outs at midday are mixed, $0.32 higher (select) and down $0.08 per cwt (choice) with light movement of 69 total loads reported (40 loads of choice cuts, 16 loads of select cuts, 8 loads of trimmings, 5 loads of ground beef).
Firm follow-through gains are seen in feeder cattle trade with triple-digit gains seen in all contracts. The limited support seen in the live cattle market with mixed prices holding at midday is keeping overall activity sluggish, but positive in feeder cattle markets. August through November contracts are holding prices above $150 per cwt with increased underlying support possible through early July even though volume surrounding the holiday is expected to remain sluggish.
Sharp early-week losses have flooded into nearby lean hog trade despite the overall lack of volume seen Monday morning. August futures are leading the complex lower with a $2.42 per cwt loss seen through the morning as prices are holding at $74.05 per cwt. This tumble lower is affecting all nearby contracts with August through December contracts posting triple-digit losses. Buyer activity is expected to be limited through the end of the session. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. The National Pork Plant Report posted 112 loads selling with carcass values adding $0.45 per cwt. Lean hog index for 6/28 is at $83.69 down 0.63 with a projected two-day index of $82.97, down 0.72.
Rick Kment can be reached at email@example.com
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