DTN Closing Livestock Comments

GENERAL COMMENTS:

Strong support flooded livestock trade as renewed focus on China trade sparked limit hog market gains. Technical support quickly developed in cattle markets, posting triple-digit gains in most contracts. Corn futures are higher in light to moderate trade. May futures added 2 1/2 cent per bushel. Dow Jones Index is 166 points higher with Nasdaq down 3 points. Cash cattle trade remained undeveloped Thursday as the light activity seen midweek limited interest due to higher futures trade. With triple-digit gains seen across live cattle futures, bids in the north of $124 live and $203 to $205 dressed gained little to no attention from feeders. Asking prices remain at $127 live and $208 and higher dressed. But if further futures gains develop Friday morning, it is expected that asking prices will too. National Daily Direct afternoon hog report is $1.15 higher with a weighted average of $76.37 per cwt. Full range of $67.00 to $78.50 per cwt on 8,486 head sold.

LIVE CATTLE: Sharp gains flooded live cattle trade due to active buying developing in feeder cattle trade ($1.10 to $2.57 higher). Strong underlying support moved back into live cattle trade, which sparked technical support in all nearby contracts. The ability to bring increased activity through the end of the week may help spark some buyer interest. This is expected to spark end of the week buyer activity through the rest of the complex. Beef cut-outs: mixed, $0.61 lower (select, $218.36) and up $0.60 (choice, $226.74) with light demand and light offerings, 106 loads (72 loads of choice cuts, 12 loads of select cuts, five load of trimmings, 17 loads of coarse grinds).

FRIDAY'S CASH CATTLE CALL: Steady to $1 lower. Bids are expected to redevelop early Friday with current bids not being taken seriously due to the sharply rising futures prices. It is expected that active trade will need to develop in the North, while additional interest is expected through the south before the end of the week.

FEEDER CATTLE: Active support developed Thursday, sparking widespread interest across the entire complex ($0.85 to $2.80 higher). Strong triple-digit shifts in feeder cattle erupted Thursday, allowing for increased underlying support to move back into the oversold market. The strong move higher in May futures pushed prices above $150 per cwt for the first time in nearly two weeks. The renewed support created a bullish technical shift through all cattle trade, sparking additional underlying interest and potentially sparking increased volume through the end of the week. CME cash feeder index for 4/3 is $142.88 up $0.44.

LEAN HOGS: Sharp gains flooded through lean hog trade Thursday, sparking continued expectations ($0.50 to $3.00 higher). Dpot month April contracts posted limited support based on sluggish cash market activity and open interest. Focus through the rest of the complex continues to point to hopes of a trade deal with China and the ability to move pork products into the country. New contract highs have developed with July and August futures surging above $100 per cwt. There is expectations that even though current demand is sluggish, things are hopeful for the rest of the year. Thanks to limit gains in June futures, the lean hog futures has expanded trading limits for Friday to $4.50 per cwt. Expanded trading limits in the hog complex has become a common occurrence over the last month, adding even more volatility to the entire market. Pork cutout prices followed futures higher with triple-digit gains. Pork cutout values added $1.96 per cwt, moving to $82.22 per cwt on 282 loads.CME cash lean index for 4/2 is $77.70, up $0.92. DTN Projected lean index for 4/3 $78.26, up $0.56.

FRIDAY'S CASH HOG CALL: $1 lower to $1 higher. Sharp gains in futures trade is being cautiously watched from the cash market perspective. Most bids are expected to be steady to firm early Friday morning, as packers continue to steadily procure needed daily market ready hogs. Friday slaughter is expected at 471,000 head. Saturday runs are expected at 145,000 head.

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

(AG)

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