Firm midday support continues to develop through the livestock complex with buyers pushing nearby live cattle and feeder cattle contracts to new contract highs. The focus on strong fundamental and technical support is helping to draw commercial interest back into the market. Triple-digit gains have quickly moved into lean hog markets, retracting losses seen Monday. Corn prices are higher in light trade. July corn futures are 5 cent higher. Stock markets are lower in light trade. The Dow Jones is 17 points lower while Nasdaq is down 4 points.
LIVE CATTLE:
Firm gains are seen in live cattle futures with strong commercial buying support led by the June futures contract posting a $1.55 per cwt rally. This has pushed front-month futures to new contract highs of $133.65 per cwt as traders continue to focus on strong beef values as well as the potential to firm cash market support during the month of June. The rest of the complex is stuck in a tightly grouped, but firm price range with gains seen from 30 to 60 cents per cwt higher at midday. The overall support across the market remains light due to many traders remaining on the sidelines and opting to wait until later in the week to step in more actively. Cash cattle markets are generally undeveloped with a couple bids slowly starting to develop in the North on a dressed basis at $216 per cwt. A few asking prices have just developed in the South at $142 at midday. But generally most of cattle country remains extremely quiet and will likely remain that way until midweek or later. Active trade could easily be pushed off until the last half of the week. Beef cut-outs at midday are higher, $1.51 higher (select) and up $2.22 per cwt (choice) with light movement of 93 total loads reported (38 loads of choice cuts, 26 loads of select cuts, 19 loads of trimmings, 11 loads of ground beef).
FEEDER CATTLE:
Narrow gains are holding across the feeder cattle complex with very little volume seen Tuesday. After aggressive triple gains flooded the market Monday, there seems to be little additional momentum left in the feeder cattle market. Nearby contracts are leading the market higher, with gains of 40 to 60 cent gains, although the support in the market is still able to push contract to new contract highs, creating additional market momentum, and keeping commercial traders active even though volume remains light.
LEAN HOGS:
Steady buyer support has moved into the lean hog futures complex through the morning following aggressive early week pressure. The pullback Monday has allowed for short covering to take place early Tuesday morning as buyers have flooded back into the market. Triple digit gains are holding in all nearby contracts with the focus on strong fundamental support as summer contracts are holding gains well above $81 per cwt. Cash prices are higher on the National Direct morning cash hog report. The weighted average price gained $0.79 at $73.63 per cwt with the range from $69.00 to $77.00 on 5,714 head reported sold. Cash prices are higher on the Iowa/Minnesota Direct morning cash hog report. The weighted average price gained $1.15 at $76.77 per cwt with the range from $73.75 to $77.00 on 2,825 head reported sold. The National Pork Plant Report reported 192 loads selling with prices falling $0.52 per cwt. Lean hog index for 6/2 is at $77.90 up $0.56 with a projected two-day index of $78.20 up $0.30.
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