DTN Midday Livestock Comments 09/18 12:03
Aggressive Buying Continues in Feeder Cattle Trade
Triple-digit gains have redeveloped across the feeder cattle complex early
Monday morning as spillover buyer support flooded into the complex. This
sparked some additional light momentum to move through live cattle trade,
although volume remained extremely sluggish.
By Rick Kment
Strong buyer support has continued to move into the cattle complex with live
cattle and feeder cattle markets holding firm gains through the entire morning.
Hog futures continue to move lower although prices have pulled away from early
market pressure as buyer support is focusing on gains seen late last week. Corn
prices are lower in light trade. December corn futures are 3 cents lower. Stock
markets are higher in light trade. The Dow Jones is 71 points higher while
Nasdaq is up 23 points.
Light to moderate buyer interest has held in live cattle futures as strong
early buying in feeder cattle futures has helped to spark follow through
commercial buying interest. This is bringing additional interest back into the
market which has held nearby contracts 25 to 50 cents higher through the
morning. Traders continue to focus on the potential to steadily add support to
the entire complex as prices attempt to break through resistance levels seen
through the end of August. Cash cattle markets are extremely quiet with bids
and asking prices nowhere to be found. The limited trade activity last week is
focusing on additional short bought packers returning to the market. But this
will not likely speed up the process as cash markets is still be delayed until
the second half of the week. Beef cut-outs at midday are higher, $2.10 higher
(select) and up $1.25 per cwt (choice) with light movement of 62 total loads
reported (27 loads of choice cuts, 9 loads of select cuts, 8 loads of
trimmings, 18 loads of ground beef).
Triple-digit gains continue to hold across nearby contracts with September
through January futures posting gains from $1 to $1.40 per cwt at midday. The
follow through support seen in the market is helping to establish new short
term highs across nearby contracts, allowing for commercial buyers to become
even more aggressive as they look toward the fourth quarter of the year.
Sharp early trade in nearby lean hog futures has moderated greatly through
the morning with prices mixed in a light to moderate range. Front month October
futures still lead the market lower with a 62 cent loss. But the rest of the
complex is mixed from 20 cents lower to 27 cents higher. The overall lack of
direction in the market continues to focus on the sharp rebound seen late last
week as traders try to sustain market stability through the complex. Cash
prices are lower on the National Direct morning cash hog report. The weighted
average price fell $1.04 at $51.87 per cwt with the range from $48.00 to $52.00
on 3,460 head reported sold. Cash prices are unreported due to confidentiality
on the Iowa/Minnesota Direct morning cash hog report. The National Pork Plant
Report reported 112 loads selling with prices adding $1.30 per cwt. Lean hog
index for 9/14 is at $64.07 down $1.08 with a projected two-day index of
$62.82, down 1.25.
Rick Kment can be reached at firstname.lastname@example.org
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