GENERAL COMMENTS: Light support trickled into several nearby lean hog futures contracts Tuesday, ending the aggressive market liquidation seen over the last week. April and May contracts ended 10 to 20 cents per cwt higher. Stability returned to the rest of the livestock market, as well, with cattle futures firming in all but nearby feeder cattle trade. Increased buyer support pushed live cattle futures to new contract highs. Activity in cash cattle markets was limited to a few asking prices scattered through the bitterly cold Midwest. Asking prices have just been seen in the North at this point with live cattle priced at $125 and higher, while dressed cattle are holding asking prices of $200 to $203 per cwt. Bids are undeveloped, and will likely remain that way over the next day or so. Active trade is not expected until the tail end of the week. National Daily Direct afternoon hog report is $0.09 higher ($47.25-$52, weighted average of $51.44) on 8,663 head sold. Corn futures were lower in light activity with March futures down 2 1/2 cents. Dow Jones Index is 36 points higher with the Nasdaq down 57 points.
LIVE CATTLE: Despite limited trade volume, the April live contract reached a new high Tuesday. Overall, futures closed $0.02 to $0.42 higher. The April live cattle futures contract barely broke through short-term support seen over the last couple of weeks, but the move was just enough to set new contract highs at $127.80 per cwt. Spring and early summer contracts also saw uniform gains of 40 to 42 cents per cwt. The extreme cold across most of cattle country is creating production and transportations issue. This is helping to support the futures trade in the short term, but likely won't affect market direction in the long term. Beef cut-outs: higher, up $0.96 (select, $212.57) to up $0.73 (choice, $218.13) with good demand and moderate offerings on a total of 114 loads (69 loads of choice cuts, 18 loads of select cuts, 10 load of trimmings, 16 loads of coarse grinds).
WEDNESDAY'S CASH CATTLE CALL: Steady. Asking prices are starting to slowly develop in the North at $125 and higher live and $200 to $203 dressed. The lack of bids is likely to keep market activity quiet until late in the week.
FEEDER CATTLE: Mixed trade developed with spot January futures prices eroding in limited volume. Futures closed mixed, down $0.82 to up $0.22. Light-to-moderate buyer support seemed to spark a little additional life in deferred feeder cattle contracts. Traders continue to exit the spot-month January futures, rolling into other spring and summer contracts. CME cash feeder index for 1/28 is $143.09, down $0.40.
LEAN HOGS: Hog futures were $0.65 lower to $0.37 higher as traders tried to adjust positions Tuesday. Even though prices have bounced higher and lower the last couple of trading sessions, markets remain stuck in a mixed range as traders try to get a sense of market support. This could result in increased buyer movement through the end of the week. The extreme cold is limiting pork processing, as transportation to packing plants remains a concern. This will significantly reduce plant schedules Wednesday. Pork prices inched higher with light-to-moderate gains in all primal cuts except rib and hams, which eroded slightly. Pork cutout values were up $0.17 per cwt, moving to $68.67 per cwt on 386 loads. CME cash lean index for 1/25 is $58.22, down $0.28. DTN Projected lean index for 1/28: $57.89, down $0.33.
WEDNESDAY'S CASH HOG CALL: Steady to $1 lower. General price pressure is expected to develop through the week. Most bids are expected steady as the limited amount of hogs available to get delivered to plants likely to stimulate buying activity in some areas. Most bids are expected to be 50 cents lower. Wednesday slaughter is expected to hit to 275,000 head, dependent primarily on weather. Saturday runs are expected to hit 310,000 head as packers try to make up for lighter weekly runs.
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