Increased buyer support developed early Thursday with feeder cattle futures sparking renewed interest. August feeder cattle trade is $3 per cwt higher at midday, helping to spark firm market support in all livestock markets. Corn futures are steady to lower in limited trade volume. September corn futures are steady. Stock markets are mixed in light trade. Dow Jones is 55 points higher with NASDAQ down 8 points.
LIVE CATTLE:
Follow-through buying has developed Thursday morning in live cattle trade, although intensity has slowed significantly over the last couple hours with narrow nearby gains holding based on limited volume late morning. October live cattle futures have struggled to move back above $100 per cwt through the last two days. This price level is a psychological barrier at this point more than fundamentally driven. Continued gains in boxed beef values are expected to spark additional momentum through the entire complex over the next few days as higher beef prices pushing packing plants to maximize capacity in order to take advantage of the improved margins. Boxed Beef cut-outs at midday are higher, $4.08 higher (select) and up $2.77 (choice) with moderate light of 50 total loads reported (26 loads of choice cuts, 9 loads of select cuts, 5 loads of trimmings, 11 loads of ground beef).
FEEDER CATTLE:
Sharp gains have continued to move into nearby feeder cattle futures with August futures holding a $3 per cwt rally at midday. August feeder cattle futures have now moved nearly $10 per cwt higher over the last two trading sessions, nearly erasing the early losses caused by panic selling through the entire cattle complex. It appears that buyer support will remain solid through the end of the session, although additional short term gains may become much more difficult to establish due to uncertainty growing in corn production levels, which will impact grain prices through the end of the year.
LEAN HOGS:
Lean hog futures have backed away from strong triple-digit gains seen at opening bell, although underlying buyer support continues to be developing in most contracts. October futures moved into front-month position Thursday, although midday pressure is slowly developing across spot month futures. Despite the 50 cent loss in October contracts, the rest of the complex is regaining buyer support, trading 20 to 70 cents higher. The potential to bring slow but steady growth back into the complex. Cash prices higher on the National Direct morning cash hog report. The weighted average price is up $0.25 at $70.42 per cwt with the range from $61 to $73.75 on 4,943 head reported sold. Pork values inched lower although widely mixed price ranges developed in primal cuts. Pork cutouts fell $0.11 per cwt at $88.79 per cwt with 127 loads traded. Lean hog index for 8/13 is $79.86, down 1.09, with a projected two-day index is $79.34, down 0.52.
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