Cash cattle trade has once again made it to Friday without any significant indication from either side of how aggressive buyer interest will be, and the expectation that it may be late in the day before any deals are struck. Asking prices continue to hold firm with early-week levels as feeders focus on the stability in beef values, and potential demand support in the next several weeks and months. But packers are unwilling to ratchet up prices at this point, potentially limiting negotiated trade volume at the end of the week in order to minimize any added spending. Futures trade is expected mixed in light to moderate activity Friday as the continued support in feeder cattle trade based on supply uncertainty through the end of the year is expected to spark limited support through the complex. The March 1 Cattle on Feed report will be released following the market's close Friday afternoon, potentially creating some additional pre-report adjustments during the morning.
Expanded trading limits are once again an option in lean hog trade Friday morning. This may continue to spark additional strong volatility in the complex that has had unrestricted buyer support the last couple of weeks. With the futures trade limit set at $4.50 per cwt Friday, the potential for wide market shifts at the end of the week continues to add uncertainty to the market. Even though strong buyer support remains in the market with expectations of further pork demand development, the complex is just one trading session away from a market reversal, which could break the momentum. Cash hog values are expected to redevelop steady to $2 per cwt higher with most bids $2 per cwt higher Friday. Expected slaughter Friday is pegged at 467,000 head, Saturday runs are expected at 164,000 head.
| BULL SIDE | BEAR SIDE | ||
| 1) |
Expected lower cattle placements through February is helping to build limited support through the complex late in the week as traders continue to adjust positions ahead of the Cattle on Feed report.
| 1) |
Limited end-of-the-week support in boxed beef values is causing some concern that follow-through beef demand may not show significant support over the near future.
|
| 2) |
Cash cattle trade is expected to remain steady to firm following the recent support in beef values and futures trade. Feeders have been unwilling to back away from strong early asking prices, creating the expectation that packers will adjust their bids through the day.
| 2) |
Despite strong market shifts seen in feeder cattle futures, nearby live cattle trade have been reluctant to shift higher. Traders still remain capped by recent market highs, unable to break through resistance levels at this point.
|
| 3) |
Limit higher trade for two consecutive trading sessions has continued to escalate the lean hog complex to contract highs. This underlying support through the complex is likely to bring about increased market support through the end of the week.
| 3) |
The higher and more aggressive the unchecked market rally moves, the greater the potential that a break in momentum will cause widespread market liquidation.
|
| 4) |
Concerns of the impact on African swine fever on global pork production has sparked increased underlying support through the entire complex. This may continue to solidify active gains in futures and cash-market trade through the near future.
| 4) | Uncertainty about global pork demand support and the potential to continue to sell actively to China and other major pork-consuming nations will continue to be the main concern about steadily increasing overall demand through 2019. |
 |
| #completeherdhealth |
No comments:
Post a Comment