Initial market pressure seen early Monday was quickly offset by active buying. This quickly posted triple-digit gains in live cattle and lean hog futures as buyers move into the complex early in the week. The inability to expand last week's losses in lean hog trade could help to bring longer-term stability to the entire complex. Corn futures are higher in moderate trade. July corn futures are 2 cents higher. Stock markets are higher in light trade. Dow Jones is 52 points higher with NASDAQ up 59 points.
LIVE CATTLE:
Strong triple-digit gains have quickly and aggressively moved into live cattle trade through the morning. This is breaking away from the light to moderate pressure late last week, and confirming the sideways trading range seen during most of June. The potential to bring additional commercial support to the table in the next couple of days may spark long-term buyer support, although the amount of cattle on feed and expected stable demand may limit upward market potential during summer months. Cash cattle markets are quiet with show list distribution and inventory taking being done. Given the fact that active trade never developed last week, showlists are expected higher in most areas, while short-bought packers may need to buy cattle sooner than later this week. Boxed Beef cut-outs at midday are mixed, $0.37 lower (select) and up $0.42 per cwt (choice) with moderate movement of 49 total loads reported (23 loads of choice cuts, 18 loads of select cuts, 3 loads of trimmings, 5 loads of ground beef).
FEEDER CATTLE:
Mixed trade is seen early Monday following strong initial pressure. The surge higher in live cattle futures and pullback in corn prices from morning highs has allowed for increased buyer support to slowly trickle into nearby contracts. Narrow trading ranges are expected through the end of the session as buyer confidence remains generally weak given the uncertainty of feed supplies over the next year.
LEAN HOGS:
Strong underlying support is moving into the lean hog complex midday Monday following the limited attempts for further liquidation. Given the already soft market structure and technical pressure that developed last week, buyers moved into the oversold market complex, sparking additional long-term support through the entire complex. This may add even more underlying support through the week as traders continue to establish a market range over the next several weeks. Most of the buyer support is seen in nearby contracts, based on potential demand support for current production, not long-term supply issues which have weakened the entire hog complex during early June. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is down $1.01 at $74.70 per cwt with the range from $67 to $76 on 4,815 head reported sold. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. Pork values slipped lower in limited volume. Pork cutouts fell $0.43 per cwt at $82.78 per cwt with 141 loads traded. Lean hog index for 6/13 is $79.46, down 0.11, with a projected two-day index is $79.27, down 0.16.
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