The aggressive buyer support which is developing in cattle markets is helping to draw increased activity to the market. There is growing support in front month live cattle and feeder cattle futures. Hog markets have eroded through the morning, although there is likely to be some additional weakness developing across the complex. Corn prices are higher in light trade. March corn futures are 4 cents higher Wednesday. Stock markets are higher in light trade. The Dow Jones is 160 points higher while Nasdaq is up 36 points.
LIVE CATTLE:
Buyer activity has quickly redeveloped in all live cattle futures with front month February contracts leading the market higher with gains of $2.80 per cwt at midday. The push to sharp near limit price surges through the morning has not only added increased support to the market, but it is helping to add volume to the entire cattle complex. All contracts are holding triple digit gains, with the focus on additional longer term support. Cash cattle activity is slowly starting to pick up with a few bids scattered in all areas. Bids are seen at $118 live and $189 to $190 dressed basis. Active trade may not develop until later in the week with a Thursday or Friday trade deadline not unlikely. The Fed Cattle Exchange Auction today listed a total of 304 head, with 108 actually sold, 53 head listed as unsold, and 143 head listed as PO (Passed Offer). The state by state breakdown looks like this: KS 196 total head, with 0 head sold, 53 head unsold, 143 head listed as PO ($118.00-$119.50); NE -- no cattle reported; TX 108 total head, with 108 head sold at $119.75, 0 head unsold, and 0 head listed as PO; CO -- no cattle reported; IA -- no cattle reported; other states -- no cattle reported. The delivery date/weighted averages breakdown is as listed: 1-9 day delivery: 304 head total, 108 head sold, with a weighted average price of $119.75; 1-17 day delivery -- no cattle reported; 10-17 day delivery -- no cattle reported; 17-30 day delivery -- no cattle reported. Boxed Beef cut-outs at midday are lower, $0.33 lower (select) and down $0.07 per cwt (choice) with light movement of 82 total loads reported (44 loads of choice cuts, 16 loads of select cuts, 10 loads of trimmings, 12 loads of ground beef).
FEEDER CATTLE:
Triple-digit gains have continued to develop across all cattle markets with feeder cattle futures holding gains from $1 to $2 per cwt midday. The overall lack of selling pressure in the market has continued to bring additional support to the market although the volume in the market may remain sluggish. Front month January futures are leading the market higher with a $2 per cwt gain, as traders are trying to keep up with gains in the live cattle futures.
LEAN HOGS:
Light to moderate losses continue to be seen in lean hog futures trade, although prices have moved significantly from sharp early losses during the first hour of trade. Front-month futures continue to hold a $1 per cwt loss, although the rest of the market remains focused on potential market stability through the end of the week. The overall lack of direction in the market could cause prices to shift in a moderate range over the near future. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is down $0.49 at $69.22 per cwt with the range from $62.00 to $71.00 on 8,000 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price is down $0.92 at $68.86 per cwt with the range from $64.00 to $69.50 on 680 head reported sold. The National Pork Plant Report posted 157 loads selling with carcass values adding $0.08 per cwt. Lean hog index for 1/15 is at $71.92 up $0.77 with a projected two-day index of $72.99, up $1.07.
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