Light to moderate pressure is seen through the entire livestock complex. This is adding additional shifts to the complex through the day, and bringing a sense of market weakness to the table. 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 29 points higher while Nasdaq is up 37 points.
LIVE CATTLE:
Mixed trade is seen in live cattle trade Wednesday morning following wild market shifts and continued underlying pressure developing in the complex. Any aggressive price support seen in February futures early in the session has quickly eroded with traders concerned about additional pressure developing in most contracts. Narrow gains are seen in deferred futures, although the tone of the market remains unsettled to weak through the last trading day of February. Cash cattle markets dispelled the expectation that activity would be delayed until late in the week once again with light to moderate trade developing in most areas. Prices are generally $2 per cwt lower than last week. Live basis price levels are seen at $126 to $127 per cwt with most sales at $126 per cwt. Dressed sales have yet to be reported, but bids are at $202 to $203 per cwt. The tone of the market is likely set given the bearish shift in futures trade through the morning. The Fed Cattle Exchange Auction today listed a total of 365 head, with 80 actually sold, 285 head listed as unsold, and 0 head listed as PO (Passed Offer). The state by state breakdown looks like this: KS 162 total head, with 80 head sold at $126.00, 82 head unsold, 0 head listed as PO; NE -- no cattle reported; TX -- no cattle reported; CO -- no cattle reported; IA -- no cattle reported; other states (Oklahoma) 203 total head, with 0 head sold, 203 head unsold, and 0 head listed as PO. The delivery date/weighted averages breakdown is as listed: 1-9 day delivery: 365 head total, 80 head sold, with a weighted average price of $126.00; 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 mixed, $0.01 lower (select) and up $0.43 per cwt (choice) with light movement of 65 total loads reported (35 loads of choice cuts, 10 loads of select cuts, 7 loads of trimmings, 12 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures have posted light to moderate pressure across the complex during morning trade. Combined pressure in the entire cattle market and end-of-month position squaring is the main focus on morning losses. This could add even more wide spread pressure through the rest of the complex with traders looking for increased direction seen in cash cattle trade through the day. Futures trade has pulled back from early session lows, but is still holding prices 30 to 90 cents lower at midday.
LEAN HOGS:
Strong triple-digit pressure is seen in lean hog futures trade through the morning, which is creating end-of-month weakness through the entire complex. There is growing concern that additional market pressure will quickly develop in all nearby contracts as futures have broken through support levels. This has totally erased the market rally seen over the last couple of weeks, and may bring added softness to the entire market. Cash prices are higher on the National Direct morning cash hog report. The weighted average price is up $0.06 at $62.51 per cwt with the range from $56.00 to $63.36 on 4,340 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price is lower $0.35 at $61.59 per cwt with the range from $58.00 to $62.50 on 1,925 head reported sold. The National Pork Plant Report posted 245 loads selling with carcass values falling $1.50 per cwt. Lean hog index for 2/26 is at $68.83, down 0.49 with a projected two-day index of $68.57, down 0.26.
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