Moderate to strong buyer support developing at the beginning of the month was unable to withstand underlying market pressure through all livestock markets. Prices have moved mostly lower at midday with moderate to strong losses seen in cattle and hog trade. Continued uncertainty surrounding export demand and trade talks with China and Mexico has added concern to the entire livestock market. Corn futures are lower in moderate trade. July corn futures are 4 cents lower. Stock markets are lower in light trade. Dow Jones is 57 points lower with NASDAQ down 105 points.
LIVE CATTLE:
Live cattle futures have quickly and aggressively pulled back from early gains with June futures leading the complex lower, even though markets remain lightly traded. August futures are still able to hold onto a 17 cent gain, but the pressure through the rest of the complex during morning trade has quickly offset any early-month buyer support through the entire complex. Traders have very little new information to trade, as concerns of trade talks with many of the major beef buyers are causing uneasiness through the complex and sparking some underlying softness through the entire market. The expectation that buyer support would redevelop during early June seemed to have many trade watchers hopeful. But as markets continue to slide lower, the concern that additional widespread liquidation will develop through the next couple of weeks. Cash cattle markets are following the typical Monday routine of show list distribution and inventory taking. This is limiting market activity through the complex, with bids and asking prices not expected until later in the week, and trade volume will likely be pushed off until Wednesday or later. Boxed Beef cut-outs at midday are lower, $0.53 lower (select) and down $0.04 per cwt (choice) with light movement of 55 total loads reported (30 loads of choice cuts, 14 loads of select cuts, no loads of trimmings, 11 loads of ground beef).
FEEDER CATTLE:
Mixed trade is seen in feeder cattle trade late Monday morning. Strong triple-digit gains flooded the market early in the session, but the inability for traders to find underlying buyer support quickly changed the tone of the market. Summer and fall contracts remain slightly higher, while light to moderate losses are developing in other contract months based on increased concern of further liquidation and increased feed prices.
LEAN HOGS:
Strong pressure redeveloped midday in lean hog futures, offsetting the early morning support which moved into the complex as traders entered the month. Trade through the last quarter of the year is leading the market lower with $2 per cwt losses. This continued to spark bearish market direction in all trade with nearby contracts holding losses near $1 per cwt. The combination of continued pork supplies seen through the country as well as concern of trade talks with China and now Mexico has added even more uncertainty to potential buyer support through the summer months. Cash prices are unreported due to confidentiality on the National Direct morning cash hog report. Cash prices unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. Pork values shifted higher in light trade following aggressive price support in rib cuts. Pork cutouts added $0.73 per cwt at $83.41 per cwt with 118 loads traded. Lean hog index for 5/30 is $81.92, down 0.30, with a projected two-day index at $81.28, down 0.64.
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