Limited trade seen early Monday morning allowed for narrowly mixed market shifts. Renewed buyer support quickly moved into cattle futures, helping to push feeder cattle to triple-digit gains based on underlying bullish support through the entire complex. Hog futures remain mixed in sluggish trade. Corn futures are lower in light trade. September corn futures are 7 cents lower. Stock markets are mixed in light trade. Dow Jones is 7 points lower with NASDAQ up 50 points.
LIVE CATTLE:
Moderate support slowly developed Monday morning following narrow early morning trade keeping prices mixed. With increased volume moving into the complex, the focus on increased buyer support in remaining 2019 contract months helped to spark underlying support through the entire complex. August futures are leading the market higher with 70 cent gains at midday, pushing spot prices above $108 per cwt. These levels continue to hover near last week's highs, as a move above $108.50 per cwt in August futures would help to spark additional underlying buyer support in not only spot trade, but most nearby contracts. Cash cattle interest remains silent Monday morning with show list distribution and inventory taking the agenda in all areas of cattle country. Bids and asking prices are unavailable, and likely to not be active until midweek or later. It is uncertain how much focus will be placed on early-week trade this week following cash market activity trickling into the complex in the final three days last week. Boxed Beef cut-outs at midday are mixed, $0.17 higher (select) and down $0.23 per cwt (choice) with light movement of 46 total loads reported (16 loads of choice cuts, 10 loads of select cuts, 12 loads of trimmings, 7 loads of ground beef).
FEEDER CATTLE:
Buying quickly moved into feeder cattle trade Monday morning following limited initial market direction. Continued pressure in corn prices which reduced overall expected feeder costs has helped to spark triple digit gains in most contract months. August futures are trading $1.40 per cwt higher with September contracts leading the complex higher with a $1.62 per cwt rally. The recent buyer support has pushed all nearby contracts above $141 per cwt, helping to sustain the bullish market shift as traders continue to focus on long-term support through the entire complex. With feeder cattle placements in Friday's report at expected levels, traders are now focused on the potential that overall cattle numbers may become slightly more manageable through the end of the year than previously expected.
LEAN HOGS:
Mixed trade is seen in lean hog trade with traders split between follow-through buyer support and early week position taking. Spot-month August futures are leading the complex lower with $1.37 per cwt losses as an early-week correction is developing following the extended market rally over the last couple of weeks. Outside of nearby contracts, firm buyer support remains, although gains have backed away from session highs, the focus on underlying bullish market support across the complex is helping to draw additional buyers into early 2020 contracts. This should help to bring additional support to market prices as traders look for increased confirmation from cash and pork values at the end of the day. Cash prices are higher on the National Direct morning cash hog report. The weighted average price is up $0.20 at $72.44 per cwt with the range from $62 to $79 on 5,606 head reported sold. Pork values moved sharply higher following a gain of nearly $19 per cwt in pork bellies. Pork cutouts gained $4.70 per cwt at $83.23 per cwt with 70 loads traded. Lean hog index for 7/18 is $72.40, up 0.88, with a projected two-day index is $73.27, up 0.87.
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