GENERAL COMMENTS: Hog futures continue to surge higher with prices shifting $13 per cwt higher in the last week. Markets have moved more than $25 per cwt off contract lows in the last month, sparking renewed interest through the entire complex. Cattle trade got caught up in the buying momentum, although concerns of cattle and calf losses are bolstering fall and winter price levels. Corn futures are higher in light activity. May futures gained 4 3/4 cents per bushel. Dow Jones Index is 219 points higher with Nasdaq up 110 points.
CASH MARKETS: Cash cattle markets remain untraded and will likely stay that way until later Friday. The underlying support in feeder cattle trade seems to be shifting a slightly bullish market tone, but packers are yet to show much interest. A few bids have popped up through the day Thursday with dressed bids in the North at $204, while Texas posted limited live bids of $124 per cwt. This is still a long ways from asking prices of $130 to $132 live and $210 per cwt dressed. Feedlot managers seem intent to hold this price point well into Friday. National Daily Direct afternoon hog report is $3.34 higher with a weighted average of $63.79 per cwt. Full range of $55.00 to $68.00 per cwt on 9,491 head sold.
LIVE CATTLE: Firm support through the rest of livestock trade sparked increased underlying support late day Thursday ($0.32 to $1.15 higher). Based on late month support in feeder cattle trade, fall and winter live cattle markets showed the most excitement with prices hovering $1 per cwt higher in late day trade. There is little interest in nearby contracts despite the continued demand support seen in the complex. April futures posted a 32-cent rally, moving to $129.90 per cwt. Even though spot month prices are testing ceiling price levels, the ability to move above $130 per cwt remains elusive. Beef cut-outs: mixed, $0.26 lower (select, $218.37) and up $0.64 (choice, $229.31) with light demand and offerings, 111 loads (72 loads of choice cuts, 19 loads of select cuts, seven load of trimmings, 13 loads of coarse grinds).
FRIDAY'S CASH CATTLE CALL: Steady. Cash cattle trade will be delayed until late in the week once again. Packer interest is expected to increase through the morning Friday, but it could be late in the afternoon until deals are struck.
FEEDER CATTLE: Continued concerns of cattle losses combined with demand expectations is sparking renewed support through all feeder markets ($0.52 to $1.87 higher). Triple-digit gains quickly formed in late spring and summer contracts as traders seem to be focused more on long-term herd implications, rather than short-term feeder cattle availability. Even though the upcoming cattle on feed report is expected to post a light to moderate reduction in placed cattle in February, the market focus is on what is happening with the cow herd and this year's calf crop. At this point, there is a lot of unknown about cattle affected by winter weather and flooding, but traders are expecting losses will be significant. This has moved August through January feeder cattle futures to new contract highs, focusing on potential supply losses. CME cash feeder index for 3/20 is $139.12 up $1.71
LEAN HOGS: Hog futures took advantage of the expanded trading range with most contracts locked in limit gains of $4.50 per cwt ($3.15 to $4.50 Higher). Traders continue to aggressively swing for the fence. This allowed most nearby contracts to remain locked in expanded limit gains of $4.50 per cwt with April futures surging to $78.32 per cwt. The rocket like momentum across the complex is creating increased optimism, but with markets at contract highs and spot month futures at the highest price since July 2018, the potential for wide market swings is significantly growing by the day. Trading limits will remain at $4.50 per cwt Friday. Strong pork price support has returned to the market following strong loin and belly values. Pork cutout values added $2.20 per cwt, moving to $76.25 per cwt on 233 loads. CME cash lean index for 3/19 is $59.22, up $1.68. DTN Projected lean index for 3/20 $60.74, up $1.53.
FRIDAY'S CASH HOG CALL: Steady to $2. Additional price support continues to flood the hog complex as packers trying to keep up with the surging price levels in order to secure continued hog flows to plants. Most bids are expected to be $1 to $1.50 higher. Friday slaughter is expected at 467,000 head. Saturday runs are expected at 169,000 head.
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