Active market pressure redeveloped Thursday morning with triple-digit losses in feeder cattle and lean hog futures. Hog futures posted the most aggressive losses as traders are bracing for additional tariffs on China to be rolled out early Friday. This could add even more volatility and market pressure to not only hog futures, but all markets. Corn futures are lower in light trade. July corn futures are 10 cents lower. Stock markets are lower in light trade. Dow Jones is 358 points lower with Nasdaq down 91 points.
LIVE CATTLE:
Mixed trade continues in live cattle futures with front-month June holding narrow, 32-cent gains while the rest of the complex moves lower. The overall lack of support focuses on triple-digit losses in feeder cattle prices while the rest of the livestock complex remains extremely bearish. Limited additional market direction is expected through the end of the Thursday session, although the tone of the complex is not expected to change significantly before the end of the week. Cash cattle interest remains quiet following trade over the last two days. Asking prices on cattle left on showlists are at $122 live and $196 dressed. The overall weakness in prices seen through the week could add increased softness through the rest of the month. A few cleanup deals may be the extent of cattle trade through the end of the week. Boxed beef cut-outs at midday are mixed, $0.50 lower (select) and up $0.40 per cwt (choice) with moderate movement of 118 total loads reported (53 loads of choice cuts, 15 loads of select cuts, 7 loads of trimmings, 42 loads of ground beef).
FEEDER CATTLE:
Even though moderate-to-sharp losses are holding in feeder cattle futures, trade volume is limited. Futures trade is well contained with $1 to $1.40 per cwt losses as traders continue to focus on general market weakness. But the overall outside market pressure in grains is also limiting additional downward pressure in the market due to lower production costs.
LEAN HOGS:
Triple-digit losses continue to hold in lean hog futures Thursday morning. News is bearish following limited sales to China on the latest export sales report and eroding expectations surrounding trade talks with China. With tariff levels expected to increase at 12:01 a.m. EDT Friday morning, traders are looking at further weakness developing in nearly all markets. Deferred futures have slowly backed away from morning lows, but the focus on overall price pressure is keeping sellers active. Cash prices are higher on the National Direct morning cash hog report. The weighted average price added $0.58 per cwt at $80.23 per cwt with the range from $77.66 to $83.00, on 7,399 head reported sold. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. Pork values firmed despite widely mixed price shifts in pork primal cuts. Pork cutouts added $1.67 per cwt at $86.61 per cwt with 108 loads traded. Lean hog index for 5/7 is $82.68 up 0.05, with a projected two-day index $82.76 up 0.08.
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