DTN Midday Livestock Comments

Strong triple-digit gains have flooded into lean hog trade with nearby contracts trading between $2 and $2.80 per cwt higher through midday. This renewed support is helping to correct the aggressive market losses seen over the past week. Cattle markets remain firmly higher following moderate buyer support stepping into live cattle and deferred feeder cattle trade. These moves in cattle markets are unlikely to change long-term direction, but helping to bring buyers back to the market. Corn markets are lower in light trade. December corn futures are 1 cent lower. Stock markets are lower in light trade. The Dow Jones is 93 points lower while Nasdaq is down 100 points.

LIVE CATTLE:

Light to moderate buyer support is seen through the live cattle complex with nearby and deferred contracts holding 40 to 55 cent gains with firm commercial support stepping back into the complex. The stability of market activity in the live cattle complex through the morning is expected to build additional strength through the rest of the trading session, although prices may not deviate significantly from current gains. Cash cattle interest remains limited Wednesday morning with asking prices seen at $114 to $115 live basis, and $180 and higher dressed. A few bids have been seen in the North at $111 live and $174 dressed as the market focused on firm futures market support. Boxed Beef cut-outs at midday are higher, $0.48 higher (select) and up $0.55 per cwt (choice) with moderate movement of 82 total loads reported (39 loads of choice cuts, 20 loads of select cuts, 15 loads of trimmings, 9 loads of ground beef).

FEEDER CATTLE:

Nearby feeder cattle futures are trading in a narrowly mixed range seen through most of the morning, while firm support is seen through the rest of the complex. There is growing support to focus on renewed buyer activity which is not only seen in feeder cattle markets, but through the entire cattle complex. January futures are leading the most recent support with a 95 cent per cwt gain as traders continue to focus on the oversold status of the market while pressure is seen grain trade Wednesday morning.

LEAN HOGS:

Aggressive buyer support has quickly flooded into nearby contracts with traders holding $2 to $3 per cwt gains at midday. December contracts have fallen off of contract highs, but have flirted with daily trading limits through much of the morning. The strong underlying support seen over the last couple of trading sessions is helping to quickly rebound price levels off of recent market lows, and instill additional confidence back into the entire hog complex. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is $0.06 lower at $57.52 per cwt with the range from $50.00 to $58.00 on 9,673 head reported sold. Cash prices are higher on the Iowa/Minnesota Direct morning cash hog report. The weighted average price is $0.05 higher at $57.56 per cwt with the range from $50.00 to $58.00 on 4,598 head reported sold. The National Pork Plant Report posted 222 loads selling on the morning report. Pork carcass values added $0.89 per cwt at $78.75 per cwt. Lean hog index for 10/22 is at $65.95 down 0.48 with a projected two-day index of 65.46, down 0.49.

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

(SK)

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