Tuesday Midday Livestock Market Summary - Mixed Trade Seen Midday Tuesday

General Comments

Mixed livestock trade has developed at midday following back and forth market shifts through most of the morning. The overall lack of trade support in the complex continues to bring about longer term uncertainty despite an attempt to push nearby contracts higher in limited trade. Corn markets are lower in light to moderate trade. December corn futures are 4 cents lower. Stock markets are higher in light trade. The Dow Jones is 39 points higher while Nasdaq is up 50 points.

LIVE CATTLE:

Mixed trade is seen through live cattle futures with firming buyer support moving through several contract months following early morning apathy. February futures have led the complex higher with a 45-cent-per-barrel gain, moving additional underlying support back into cattle trade, although longer-term support is still uncertain. Live cattle trade continues to hold within the wide sideways trading range seen over the last couple of months as traders look for renewed support from beef market fundamentals. Cash cattle activity is still undeveloped with bids and asking prices still unavailable. The overall lack of activity this early in the week is not surprising in any way, as packer interest is not expected to quickly develop until midweek or later. It is likely that active trade will be delayed until late Thursday or Friday. Boxed Beef cut-outs at midday are mixed, $1.02 higher (select) and down $0.19 per cwt (choice) with light movement of 58 total loads reported (36 loads of choice cuts, 10 loads of select cuts, 5 loads of trimmings, 7 loads of ground beef).

FEEDER CATTLE:

Given the back and forth market shifts seen in cattle trade through the morning, the aggressive move higher in feeder cattle at midday is helping to solidify buyer support across the entire complex. January and March futures are holding triple-digit gains, allowing for increased underlying support as trade continues to remain on the lower end of the trading range. The inability to hold early-week gains is likely to be viewed as bearish and could lead to additional market pressure through the end of the month.

LEAN HOGS:

Renewed buyer support has slowly but steadily moved into several nearby contracts with February futures leading the complex higher with an 80-cent-per-cwt gain. The firm gains in pork values in the morning report combined with underlying commercial buyer activity returning following triple digit gains Monday is helping to bring about additional market momentum and pushing prices off of recent lows. The complex continues to wander within a wide sideways trading range, but with February futures moving away from $60 per cwt support levels, the expectation is that additional buyer support may quickly move into the market over the next couple of weeks. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is $0.75 lower at $52.19 per cwt with the range from $47.00 to $52.44 on 3,531 head reported sold. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. The National Pork Plant Report posted 224 loads selling on the morning report. Pork carcass values added $0.85 per cwt at $71.68 per cwt. Lean hog index for 11/12 is $61.20, down 0.67, with a projected two-day index of $61.87, down 0.90.

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