Activity onMonday morning in the cash cattle market will be undeveloped with showlist distribution and inventory-taking consuming the time and energy of both packers and feedlot managers. Some underlying support is expected going into the week following the price gains in Friday's cash trade. But packers are proceeding with caution in order to not get too far ahead of themselves, as they will try to get some additional direction from beef values through the next couple of days. Live cattle trade is expected to bring about increased market shifts early in the week with the firming market tone through most of the day Friday expected to bring back buyer interest, even though concerns of pressure in feeder cattle trade could limit additional market shifts.
Follow-through selling pressure is likely to be met head on with short-covering early Monday morning as prices expected to bounce higher and lower through the first couple hours of trade. The focus in the complex continues to be based on recent market support, which is still moving prices steadily higher through the end of last week. Cash hog prices are expected to continue to firm, although the tone of the market is starting to falter slightly through the last few days. Cash bids are expected steady to $1 per cwt through the morning, with most bids steady to firm. Hog slaughter is expected to be 477,000 head on Monday.
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Live cattle futures continue to hover in the top end of the trading range in nearby contracts. With February futures knocking on the door of new contract highs, the potential for early-week buying could bring about new highs during the Monday session.
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Limited buyer activity in nearby feeder cattle trade has continued to add some market uncertainty to the entire cattle complex. Feeder cattle futures are less than $1 per cwt above November lows in the continuous price chart, signifying potential pressure likely through the upcoming weeks.
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Continued support in cash cattle trade continues to be an underlying shift higher in the market tone. Cash prices late Friday were mostly $1 to $2 per cwt higher from week-ago levels, helping to sustain the developing support.
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Limited interest in beef values has added even more concern to the entire complex, despite firming cash cattle trade. This lack of movement in wholesale cuts will likely add even more uncertainty to the complex through the first half of the week.
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Cash hog prices continue to lead the market higher with steady-to-firm cash market support still developing through midmonth as traders focus on strong packer margins and the potential to put more pork into storage.
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Lean hog futures quickly pulled back from weekly highs as traders allowed increased pressure to sweep through the complex. This added even more uncertainty to the complex as traders are starting to focus on growing pressure in cash markets.
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Moderate-to-strong price support has continued to develop in pork values, with cutout values showing firm market support Friday. This strength comes despite moderate-to-firm pressure in lean hog futures as packers continue to focus more on long-term demand potential than short-term shifts at this point.
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Growing concerns about trade issues and rebuilding longer-term export activity through 2019 continues to be front and center of marketing challenges for the pork industry. This is likely to curb any sense of optimism over the coming weeks as traders look for long-term trading partners and extended business to bank on.
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| #completecalfcare |
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