Firm losses continue to hold through the entire livestock complex. Despite moderate early gains in lean hog trade, the inability to bring consistent buyer interest back into the market has allowed prices to soften through morning trade. Cattle trader remains under pressure based on increased cattle placement levels last month, creating underlying supply concerns. Corn futures are higher in sluggish trade. May corn futures are 1 1/2 cent higher. Stock markets are lower in light trade. Dow Jones is 50 points lower with Nasdaq down 24 points.
LIVE CATTLE:
Triple-digit losses have moved through nearby live cattle trade Monday morning as traders assess feedlot growth through the month of February and how this will affect short- and long-term supplies. The inability to show consistent support in boxed beef values through the last week is causing some uncertainty through the entire market. April live cattle futures are leading the complex lower with a $1.35 per cwt. Even though moderate losses are likely to hold through the near term, prices are expected to continue to hover within the sideways $3 per cwt trading range seen over the last month. The inability to push prices above $130 per cwt at the end of last week continues to cap price levels at this point. Cash cattle activity remains sluggish with inventory taking and show list distribution likely to spark additional interest through the rest of the week. At this point, bids and asking prices are not expected to be seen until midweek with trade likely to be pushed off to the last half of the week. Boxed Beef cut-outs at midday are mixed, $0.69 higher (select) and down $0.27 per cwt (choice) with light movement of 32 total loads reported (18 loads of choice cuts, 9 loads of select cuts, no loads of trimmings, 6 loads of ground beef).
FEEDER CATTLE:
Light to moderate losses have moved through cattle futures with April thorough November contracts holding uniform losses of 60 to 70 cents per cwt. The early-morning pressure based on increased February cattle placements posted triple-digit losses. But the inability for traders to contain the same level of bearishness through the morning is allowing buyers to slowly trickle back into the market based on expectations of firming demand through the upcoming weeks and months.
LEAN HOGS:
Early-market support has slowly eroded through the morning Monday with April contracts the only futures contract holding gains at midday, with a 20-cent gain holding midday. The remainder of the complex has started to back away from previous gains despite early-morning support. Deferred contracts have been hit the hardest, with losses of $1 to $2.25 per cwt seen in late 2019 and early 2020 contracts. The emotional support that has driven the market aggressively higher, is starting to fade, allowing traders to assess realistic fundamental moves over the near future. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.04 at $66.23 per cwt with the range from $60.00 to $69.00, on 3,935 head reported sold. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. Pork values have posted continued support with firm early week primal gains leading to additional support through the entire market. Pork cutouts gained $1.21 per cwt at $79.00 per cwt with 121 loads traded. Lean hog index for 3/21 is $62.41, up $1.66, with a projected two-day index is $64.97, up $2.56.
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