Moderate follow-through buying has quickly developed in live cattle trade Tuesday morning. Even though feeder cattle and lean hog futures have posted losses through the morning, the underlying firm tone carried from Monday's rally is still holding. Corn markets are higher in light trade. March corn futures are 1 1/4 cent higher. Stock markets are higher in light trade. Dow Jones is 75 points higher with Nasdaq up 17 points.
LIVE CATTLE:
Firm gains are holding in nearby live cattle trade as traders continue to adjust markets higher following early-week support. The strong underlying support in all livestock trade is helping to solidify buyer activity through the entire complex. This may add even more momentum to the complex as traders are looking for increased support in meat values as well as firming outside market shifts through early February. Cash cattle activity remains undeveloped Tuesday with bids and asking prices unavailable. It is expected that most trade will be pushed to the last half of the week. Feedlot managers are slow to float asking prices as the supportive moves in futures trade is likely to firm market prices as the week continues. Boxed Beef cut-outs at midday are mixed, $0.28 higher (select) and down $0.26 per cwt (choice) with light movement of 66 total loads reported (35 loads of choice cuts, 13 loads of select cuts, 3 loads of trimmings, 14 loads of ground beef).
FEEDER CATTLE:
Prices in all feeder cattle trade have eroded through the morning, but limited pressure is focused more on early market adjustments following the sharp Monday gains. Nearby futures are holding 50 to 70 cent losses, which is still over $1 per cwt higher than markets opened Monday. Traders are now focusing on rebuilding fundamental and technical support through the complex.
LEAN HOGS:
Limited selling is seen midday following sharp losses moving into the complex through the first hour of trade. Most of this morning pressure is focused on positioning squaring after the strong gains developed Monday. April futures are leading the complex lower with a $1.45 per cwt loss, although the tone of the market remains firm thanks to gains of nearly $3 per cwt seen Monday. Following the position squaring seen early in the morning, it appears that commercial buying is starting to redevelop, as traders focus on rebuilding market support based on expected longer term momentum. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is down $0.12 at $50.43 per cwt, with the range from $46.00 to $51.08 on 6,603 head reported sold. Cash prices are higher on the Iowa/Minnesota Direct morning cash hog report. The weighted average price is up $0.35 at $50.05 per cwt, with the range from $46.00 to $50.25 on 3,640 head reported sold. Pork carcass values are lower on the morning report with prices slipping $1.14 per cwt at $66.98 per cwt with 216 loads traded. Lean hog index for 2/1 is $57.41, up $0.23, with a projected two-day index is $57.36, down $0.05.
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