Strong gains seen in hog markets has offset the late morning pressure developing in cattle trade. Early triple-digit gains seen in live cattle and feeder cattle markets continue to be offset by light volume and uncertainty based on concerns of another pullback developing through the complex. Corn prices are higher in light trade. July corn futures are 2 cents higher. Stock markets are mixed in light trade. The Dow Jones is 7 points lower while Nasdaq is up 21 points.
LIVE CATTLE:
Live cattle futures have pulled back from early gains with traders most contracts holding losses. June futures are leading the market losses with a 60 cent downturn. Activity may continue to develop through the rest of the trading session, although price movement may continue to remain choppy through the rest of the day based on the lack of overall consistency of trade volume and lack of direction in the market. Cash cattle markets are still silent Tuesday morning with bids and offers generally undeveloped. It is expected that bids will start out around $150 or higher on a live basis given the support last week and futures activity seen over the last couple of days, but cash market interest may be delayed until the second half of the week. Beef cut-outs at midday are higher, $2.19 higher (select) and up $0.45 per cwt (choice) with light movement of 67 total loads reported (28 loads of choice cuts, 17 loads of select cuts, 10 loads of trimmings, 13 loads of ground beef).
FEEDER CATTLE:
Buyers have quickly pulled back Tuesday morning as traders have moved from strong early triple-digit gains to narrow losses at midday. The early losses seen in the complex have allowed for traders to back away from the potential of moving to new contract highs once again as buyers are now starting to focus more on the concerns that longer-term concerns may be setting into the complex. There still seem to be some uncertainty in the market, although market volatility seen through late morning could allow for prices to move in a wide range during the next couple of trading sessions.
LEAN HOGS:
Firm buyer support has developed through nearby contracts as traders focus on increased fundamental support and firming pork values through early May. The expectation that even stronger buyer support may continue to develop in nearby futures trade could move into the summer contract months may help to keep futures trade reaching toward $80 per cwt through the next couple of weeks. With the potential to move through resistance levels of $79.90 per cwt in these summer contracts, a move above $80 per cwt is likely to bring about additional strong commercial buyer support during the summer months. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.56 at $64.46 per cwt with the range from $61.00 to $67.00 on 4,530 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 244 loads selling with prices added $1.25 per cwt. Lean hog index for 5/5 is at $64.79 down $1.24 with a projected two-day index of $65.98 down $1.19.
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