GENERAL COMMENTS:
Aggressive losses were not evident in just livestock trade, although the activity levels and extreme losses seen through the complex has sparked increased unrest in cattle and hog futures. With hog trade settling limit lower, increased volatility is expected with expanded trading limits allowing for even wider market swings Tuesday. Cash cattle interest remains quiet Monday with show-lists mixed for the week. Increased offerings in the North are offset by lower cattle available in Texas; Kansas listings are generally steady with last week's level. Early week trade may start to develop based on recent market shifts. Bids and asking prices are unavailable, but may start to develop either Tuesday or Wednesday. National Daily Direct afternoon hog report is unavailable at this time due to report delays. Corn futures added in light trade. July futures fell 4 3/4 cents per bushel. Dow Jones Index is 637 points lower with Nasdaq down 271 points.
LIVE CATTLE: Active losses quickly swept through all livestock trade and most commodity markets Monday as traders become concerned about long-term direction when it comes to export markets ($1.45 to $2.70 lower). The sense of support and renewed market optimism seen late last week was short-lived with traders giving back all of the Friday gains and continuing the market pressure. June futures led the complex lower with a $2.70 per cwt loss, moving front month contracts below $110 per cwt for the first time since last summer. If June futures are not able to hold support levels of $109.60 per cwt, 15 cents below current levels, the next target level remains at $108 per cwt with only limited support at this level also. The market uncertainty could spark additional underlying pressure through the complex.Beef cut-outs: higher, $1.43 higher (select, $208.89) and up $0.47 (choice, $221.58) with light demand and moderate offerings, 89 loads (40 loads of choice cuts, 23 loads of select cuts, 12 load of trimmings, 14 loads of coarse grinds).
TUESDAY'S CASH CATTLE CALL: Steady. Interest is expected to remain sluggish early Tuesday, but bids could start to trickle into the market later Tuesday based on early week trade developing over the past few weeks.
FEEDER CATTLE: Outside pressure sparks active selling pressure ($2.55 to $3.72 lower). Traders backed away from any sense of support seen late last week as triple-digit losses moved into the complex. Not only are traders concerned and nervous regarding a trade deal with China, as talks apparently unraveled last week in Washington. However, traders are also focusing on what may happen as the U.S. takes on Japan in trade discussions. It is also relevant that the trade deal with Mexico and Canada has not been ratified and passed through Congress, leaving uncertainty at every level through the export market. CME cash feeder index for May 10 is unreported at this time.
LEAN HOGS: Sharp losses focused on trade uncertainty with China and widespread pressure through most other commodity and financial markets ($0.60 to $3 lower). Active pressure developed Monday afternoon following increased tariff levels put on U.S. products by China. This move is in retaliation of tariff levels that went into effect Friday. June through August futures posted limit losses of $3 per cwt. This will allow for expanded trade limits Tuesday and could bring even more volatility to the complex. Pork cutouts rallied higher based on triple-digit gains in several primal cuts. Pork cutout values added $2.08 per cwt, moving to $88.24 per cwt on 212 loads.CME cash lean index for May 9 is $82.80, up $0.04. DTN Projected lean index for May 10 is $83.04 up $0.24.
TUESDAY'S CASH HOG CALL: Steady to $1 Lower. Limited activity is expected over the next couple of weeks, with bids steady to $1 per cwt lower. The underlying pressure in futures trade is likely to curb support in cash markets, although the need to access needed hog numbers will limit the downside market pressure.
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