DTN Midday Livestock Comments

General Comments

Strong losses have developed in lean hog futures Thursday morning. Increased underlying pressure may continue to be seen through the end of the week as the emotional buyer support seen last week has quickly eroded. Cattle markets are mixed in a very narrow trading range. Corn futures are steady to slightly lower in light trade. May corn futures are steady. Stock markets are lower in light trade. Dow Jones is 2 points lower with Nasdaq down 3 points.

LIVE CATTLE:

Mixed trade continues to develop in limited interest as traders seem to be willing to hold the current price pattern through the near future. Even though April futures have pushed below March support levels, the tone of the market remains firm, which may help to rekindle buying activity during early April. Traders continue to focus on expanded demand through the spring and summer, allowing for increased overall support through the entire complex. Cash cattle activity remains sluggish with limited bids developing in Nebraska at $125 live and $204 per cwt dressed. Following the light to moderate trade Wednesday it is uncertain just how much additional trade will develop through the end of the week. Boxed Beef cut-outs at midday are lower, $0.19 lower (select) and down $1.10 per cwt (choice) with light movement of 50 total loads reported (38 loads of choice cuts, 9 loads of select cuts, no loads of trimmings, 3 loads of ground beef).

FEEDER CATTLE:

Narrow losses are seen in feeder cattle trade with limited additional direction developing Thursday morning. April contracts are holding a 20 cent loss, moving to $145.70 per cwt. Nearby contracts have posted strong losses over the last four trading sessions, but still remain well above support levels, and could remain in the wide sideways pattern for an extended period of time. Growing weakness in lean hog trade is limiting buyer activity through the morning, but most traders are unwilling to aggressively shift prices due to the lack of overall direction in the complex.

LEAN HOGS:

Losses have continued to expand as summer losses above $2 per cwt midmorning. This sparked additional concerns that increased market pressure continues to add uncertainty to the market. April futures are $1.90 per cwt lower, with the rest of 2019 contracts $2 to $2.50 per cwt lower. The potential to expand further losses through the rest of the week is growing as traders remain concerned about the ability to sell pork to China. Continued varied reports about what the impact of total hog numbers impacted is hard to get an accurate read on the overall situation. This could leave markets unsettled over a long period of time. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.01 at $74.98 per cwt with the range from $66.00 to $78.00, on 4,339 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price fell $0.72 at $75.99 per cwt with the range from $66.00 to $78.00, on 1,523 head reported sold. Pork values continue to move higher, but wide price swings in pork primal cuts has caused some uncertainty through the market. Pork cutouts gained $0.44 per cwt at $82.07 per cwt with 152 loads traded. Lean hog index for 3/26 is $69.50, up $2.37, with a projected two-day index is $71.72, up $2.22.

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

(CZ)

Copyright 2019 DTN/The Progressive Farmer. All rights reserved.