Sharp losses redeveloped Tuesday morning with traders focusing on increased market activity and the continued fundamental pressure seen in the market. Triple-digit losses are seen in all nearby lean hog futures, although overall trade volume remains sluggish. Cattle trade is mixed in a narrow range, while the tone of the market remains weak. Corn prices are higher in light trade. May corn futures are 4 cents higher. Stock markets are higher in light trade. The Dow Jones is 97 points higher while Nasdaq is up 3 points.
LIVE CATTLE:
At different times through the morning, live cattle prices have posted strong gains and aggressive losses as traders try to find a balance given the light trade activity and limited movement in the complex. There is growing support that markets could remain generally stable given mixed futures price moves of 30 cents lower to 20 cents higher. There is limited volume in the complex midday. This lack of activity could keep markets volatile over the next couple hours. Cash cattle interest remains sluggish Tuesday morning, although a few token starter bids are slowly trickling into the market. These bids are seen at $118 live and $188 dressed. However, unless something significant shakes out of the futures trade, most feedlot managers are not likely to bite at this point of the week. Asking prices are hard to find at this point, and could be delayed until midweek or later. Boxed beef cut-outs at midday are mixed, $0.72 higher (select) and down $0.22 per cwt (choice) with light movement of 64 total loads reported (36 loads of choice cuts, 18 loads of select cuts, 3 loads of trimmings, 6 loads of ground beef).
FEEDER CATTLE:
Mixed trade is seen through the feeder cattle complex with traders pushing prices higher and lower through most of the morning. Early market swings have brought more attention to the building pressure in the cattle markets while buyers are desperately trying to cover positions and bring some stability to the market. Prices at midday are hovering from 15 cents lower to 30 cents higher. The potential for wide market swings continues through the end of the session.
LEAN HOGS:
Sharp losses quickly redeveloped through nearby lean hog futures trade Tuesday morning with April and June futures down $1 per cwt. The continued weak market tone and availability of hogs continues to keep traders looking for an exit strategy. Even though domestic demand continues to remain strong, the concern that export markets will continue to erode is further weakening market prices through early April. April futures have fallen $24 per cwt since early January, as the tone of the hog complex has remained weak for an extended period of time. While the China tariff announcement has brought new attention to the market, the pork complex has been under pressure for a while. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price is down $0.44 at $46.10 per cwt with the range from $45 to $48 on 3,955 head reported sold. The National Pork Plant Report posted 212 loads selling with carcass values gaining $0.70 per cwt. Lean hog index for 3/30 is at $56.72, down 1.32, with a projected two-day index of $56, down 0.72.
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