Sharp triple-digit losses have redeveloped Monday morning with contracts breaking through support levels of $52.97 per cwt through early trade. Limited support has pushed nearby lean hog trade off of session lows, but the complex remains under strong pressure based on fundamental weakness. Cattle trade is mixed in a narrow range after unable to sustain early buyer activity. Corn futures are lower in sluggish trade. March corn futures are 4 3/4 cents lower. Stock markets are higher in light trade. Dow Jones is 162 points higher with Nasdaq up 44 points.
LIVE CATTLE:
Limited trade activity is seen in live cattle futures early Monday morning. This is allowing prices mixed in a narrow range at midday with prices hovering from 30 cents lower to 2 cents higher. Gains in the limited cash cattle trade that was reported last week helped to spark some early morning buying activity. But the focus through cattle country is likely more focused on cleaning up from the latest round of snow and ice storms, which may limit commercial trade activity through the day. Cash cattle activity remains sluggish with inventory taking and show list distribution the main order of business when it comes to marketing. The limited trade last week is creating additional questions, with expected left over cattle from last week needing to be moved off of yards. Boxed Beef cut-outs at midday are higher, $2.20 higher (select) and up $0.03 per cwt (choice) with light movement of 39 total loads reported (16 loads of choice cuts, 8 loads of select cuts, 3 loads of trimmings, 9 loads of ground beef).
FEEDER CATTLE:
Lack of trade activity early Monday seems to be the main focus through feeder cattle trade with prices scattered from 25 cents lower to 27 cents higher in very limited activity. The lack of consistency through the complex Monday is adding to the focus on increased underlying activity. This may add some additional stability to the complex as traders focus on sharp losses in hog trade as well as continued pressure through the grain complex. Little new market information is expected to develop through the rest of the complex, allowing for stagnant market direction to likely continue the rest of the trading session.
LEAN HOGS:
Sharp triple-digit losses swept through nearby contracts once again with April through August futures now trading $1 to $2.10 per cwt lower. Although spot month April futures have pulled back from session lows, the tone of the market has quickly weakened. Hopes late last week of export deal news and trade talks with China has once again fallen on deaf ears for hog traders as no new information is available and traders are looking for any sense of support. April futures are holding at $53.27 per cwt Monday morning. A close below $52.97 would set contract lows and break through support levels seen last week. This would likely further weakness across the complex. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.28 at $46.62 per cwt with the range from $43.00 to $47.00 on 3,540 head reported sold. Cash prices unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. Pork carcass values bounced higher Monday morning following triple digit gains in most primal cuts. Pork cutouts added $1.52 per cwt at $60.53 per cwt with 89 loads traded. Lean hog index for 2/21 is $53.65, down $0.41, with a projected two-day index is $53.13, down $0.52.
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