Firm pressure is building in cattle trade following triple-digit losses moving through nearby feeder cattle trade. The concern that April contracts will move through initial support levels of $145.30 through the end of the week has caused active liquidation. This has sparked underlying pressure in live cattle markets with April futures firmly lower. Hog futures have held onto early gains, but initial market surges have slowly eroded through the morning. Corn futures are lower in sluggish trade. March corn futures are 1 cent lower. Stock markets are mixed in light trade. Dow Jones is 8 points lower with Nasdaq up 5 points.
LIVE CATTLE:
Narrow losses have held through live cattle futures with traders closely focusing on outside market shifts and the overall lack of support developing in feeder cattle trade Thursday. A strong triple-digit loss in the feeder cattle complex could quickly derail the recent support that has slowly but steadily developed in live cattle trade. After testing but not breaking long-term support levels of $130.10 per cwt Wednesday in April contracts, traders have been extremely cautious. This $130 per cwt barrier remains hard to penetrate, and could lead to a moderate to strong market retraction over the near future despite fundamental support. Cash cattle interest is quiet with bids holding at $124 to $125 live and $202 dressed. It appears that both sides will hold onto their position, with late Friday trade likely to be seen once again. Asking prices remain at $130 and higher live and $205 to $206 dressed. Boxed Beef cut-outs at midday are higher, $2.39 higher (select) and up $0.23 per cwt (choice) with moderate movement of 94 total loads reported (40 loads of choice cuts, 19 loads of select cuts, 6 loads of trimmings, 29 loads of ground beef).
FEEDER CATTLE:
Triple-digit losses have continued to hold across feeder cattle trade. Although prices have bounced off of session lows, the underlying weaker tone in the market on the last trading day of February is causing some concern that nearby contracts may be unable to hold support levels set last week. Despite the strong moves in live cattle trade over the last couple of weeks, the underlying concern surrounding future moves in grain trade has feeder cattle traders extremely cautious to actively step back into the complex.
LEAN HOGS:
Narrowly mixed trade is seen midday Thursday with all nearby contracts hovering in a mixed single-digit trading range. The lack of support seen through the morning in order to hang onto firm initial gains is evident of the limited trade volume in the market and traders focusing on end-of-month adjustments. Even though cash hog prices eroded slightly in the morning reports, the expectations that traders may continue to focus on increased underlying support through the rest of the week and maintain recent support levels, has the potential market losses limited through the day. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.41 at $44.87 per cwt with the range from $42.50 to $45.75 on 5,246 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price fell $0.34 at $45.12 per cwt with the range from $42.50 to $45.75 on 1,365 head reported sold. Pork carcass values posted additional market pressure as wholesale pork markets continue to swing back and forth in a wide range. Pork cutouts inched higher, gaining $0.37 per cwt at $59.94 per cwt with 184 loads traded. Lean hog index for 2/26 is $52.82, down $0.03, with a projected two-day index is $52.64, down $0.18.
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