Cash cattle trade activity is expected to remain
sluggish through most of the week with bids and asking prices
undeveloped Monday. Showlists are generally larger with Texas the only
region posting lighter offerings for the week. Bids and asking prices
may not develop until late Tuesday or Wednesday, with trade likely to be
pushed off to the end of the week. Strong price pressure ratcheted
markets back from the top edge of the trading range following increased
cattle on feed numbers. Although the increase in placements and overall
on feed numbers is not likely enough to push prices lower in itself, the
uneasiness through the entire livestock complex added to the overall
market pressure. Early trade is expected to remain under pressure,
although nearby contracts are expected to still hold short-term support
levels, allowing markets to hover in the currently wide sideways pattern
in the next couple of weeks.
Strong pressure developed through the lean hog
complex with traders pulling away from contracts highs. The volatility
in Friday's market lead to additional underlying pressure through the
entire complex. Deferred lean hog futures were impacted by the lack of
follow-through support in the complex, allowing for increased overall
weakness and triple-digit losses. April futures have held onto moderate
gains, with a 32-cent price bounce in late-day trade. This allowed for
increased overall stability in spot trade, while the rest of the complex
remains under light pressure, but still sustaining a generally bullish
market direction. Cash hog values are expected to redevelop steady to $2
per cwt higher with most bids $1 per cwt higher Monday morning.
Expected slaughter Tuesday is at 477,000 head.
BULL SIDE | BEAR SIDE | ||
1) |
Summer and winter live cattle trade
still remains well above 40- and 100-day moving averages, despite the
strong triple-digit pullback in price levels. This continues to spark
underlying buyer activity in the complex.
|
1) |
Live cattle futures have turned
lower, breaking the two-week market surge in the complex. This could add
follow-through pressure in the complex.
|
2) |
Seasonal beef demand is expected to
pick up through the spring and summer, with increased temperatures and
outdoor grilling activity making up for lost time over the cold winter
and spring.
|
2) |
Beef values continue to add
uncertainty to the complex with narrowly mixed trade developing across
the entire complex. This could limit follow-through support through the
near future.
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3) |
Aggressive buyer support continues
to flood into cash hog trade. This continues to spark increased
underlying support in the entire complex, maintaining buyer interest in
futures trade.
|
3) |
Strong pressure in deferred lean hog
trade has added to the lack of support in the hog complex. This has the
potential to pull prices lower in the near future, limiting underlying
buyer support in the entire complex.
|
4) |
Pork values have continued to surge
higher with increased overall buyer interest in the entire complex.
Expected strong demand growth is sparking widespread primal market price
support.
|
4) | Little details concerning overall export market support the last couple of weeks is adding increased overall pressure to the entire complex. |
#completeherdhealth |
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