Firm pressure in all livestock trade has sparked renewed weakness Thursday morning. Feeder cattle trade has led the market lower, focusing on increased grain prices and continued concerns of production losses due to wet weather and late planting. Corn futures are higher in moderate trade. July corn futures are 6 3/4 cents higher. Stock markets are higher in light trade. Dow Jones is 123 points higher with NASDAQ up 31 points.
LIVE CATTLE:
Live cattle trade continues to erode through the morning as light to moderate pressure is seen in all live cattle trade once additional volume moved into the market and initial short covering subsided. August futures are 45 cents lower with pressure developing from lack of strong support expected in beef values and sharp triple-digit losses in feeder cattle creating increased market weakness across the complex. Even though prices have shifted lower through the morning, the market is expected to remain in the current sideways trend over the near future. Cash cattle started to develop in the South with live prices of $110 per cwt seen. This is $2 per cwt lower than last week, and could be enough trade to set the trend for the week. Activity in the North remains quiet with no bids on the table at this point. Asking prices remain firm at $112 to $115 live and $185 and higher dressed. Boxed Beef cut-outs at midday are higher, $0.23 higher (select) and up $0.27 per cwt (choice) with light movement of 45 total loads reported (24 loads of choice cuts, 12 loads of select cuts, no loads of trimmings, 9 loads of ground beef).
FEEDER CATTLE:
Active pressure is moving into feeder cattle trade Thursday following new gains in corn trade. The strong underlying support in grain prices based on weather conditions and expected reduced production sparked triple-digit losses in all feeder cattle futures. Although futures have pulled back from session lows, markets still remain $1.40 to $1.60 per cwt lower based on expected feed cost increases as well as firming pressure in live cattle trade.
LEAN HOGS:
Firm pressure is quickly moving into lean hog trade Thursday morning with increased focus on widespread market pressure in all livestock trade. July futures are leading the complex lower with a $1.37 per cwt loss at midday, as traders quickly back away from midweek support. Renewed buyer support in grain markets is limiting overall support, while traders are also pulling back from recent support following no additional sales to China on the export sales report. The fact that China exports remain hit-or-miss is not shocking to the market. Given the country's need for pork, it makes it even more evident of its efforts not to buy pork from the U.S. Hopes of upcoming trade talks seem to have eased for now, but this will likely limit additional price pressure in the next week. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is down $1.47 at $74.93 per cwt with the range from $67 to $76 on 4,776 head reported sold. Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. Pork values bounced higher despite sharp losses in picnic cuts. Pork cutouts added $0.83 per cwt at $78.52 per cwt with 153 loads traded. Lean hog index for 6/17 is $79.26, down 0.01, with a projected two-day index is $79.49, up 0.23.
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