Sharp losses in live cattle trade and feeder
cattle markets have focused increased market direction as traders take
into account pressure in beef values. Hog markets are mixed as early
support is eroding in late week positioning. Corn markets are higher in
light trade. March corn futures are 2 cents higher. Stock markets are
higher in light trade. Dow Jones is 825 points higher with Nasdaq up 286
points.
LIVE CATTLE:
Triple-digit losses have quickly moved into
nearby live cattle trade with February through June contracts holding $1
to $1.30 per cwt losses. This lack of support is a combination of sharp
triple-digit losses in feeder cattle trade, while beef values have
softened in the cutout report. The concern that beef demand may slowly
erode through January due to outside market pressure is causing
widespread weakness through the futures trade. Cash cattle trade is
developing in the North on a dressed basis with prices at $193 to $195
per cwt with most sales at $195 per cwt. These prices are fully steady
with last week, and continue to focus on steady trade after live cattle
sales Thursday. Live bids are seen at $122 to $123 per cwt, which could
create some additional clean up trade before the end of the day. At this
point, prices seem to have been set. Boxed Beef cut-outs at midday are
lower, $1.56 lower (select) and down $1.64 per cwt (choice) with light
movement of 70 total loads reported (44 loads of choice cuts, 11 loads
of select cuts, no loads of trimmings, 15 loads of ground beef).
FEEDER CATTLE:
Sharp triple-digit losses have continued to
develop in feeder cattle trade with traders focusing on firm support in
the grain complex, which is sparking additional underlying concerns
about overall production costs. With cattle numbers expected to remain
strong through most of the spring, more focus will be placed on feed
costs in 2019. This is directly affecting feeder cattle prices on the
futures complex, as traders are uncertain of additional support in the
live complex.
LEAN HOGS:
Early support in lean hog futures has eroded
during morning trade with spot February contracts holding steady prices
at midday, while other nearby contracts are trading moderately lower.
End-of-week market positioning has pushed prices lower as traders adjust
from the strong market rally seen over the last week. Cash prices are
lower on the National Direct morning cash hog report. The weighted
average price is down $0.06 at $47.37 per cwt with the range from $45.50
to $47.64 on 3,930 head reported sold. Cash prices are lower on the
Iowa/Minnesota Direct morning cash hog report. The weighted average
price is down $2.52 at $46.19 per cwt with the range from $45.50 to
$47.00 on 438 head reported sold. Pork carcass values are higher on the
morning report with prices gaining $1.05 per cwt at $70.95 per cwt with
229 loads traded. Lean hog index for 1/02 is $53.25, up 0.17, with a
projected two-day index is $53.63, up 0.38.
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