Active triple-digit gains have quickly developed in lean hog and feeder cattle futures Thursday morning. The initial follow-through rally seen in the lean hog complex at opening bell briefly broke through short term resistance levels and moved to new August highs, before eroding slightly through the rest of the morning. Firm gains have slowly but steadily developed across all cattle futures as the previous pressure has created renewed support through the entire complex at current price levels. Corn futures are mixed in light morning trade. December corn futures are steady. Stock markets are higher in active trade. Dow Jones is 398 points higher with NASDAQ up 125 points.
LIVE CATTLE:
Firm gains have steadily developed Thursday morning with increased underlying support developing across the entire complex. Strong gains in feeder cattle futures have renewed buyer interest in most contracts, allowing for increased underlying support to develop through the rest of the complex. Cash cattle trade is starting to slowly develop with a few trades in Nebraska at $105 live and $170 dressed. This is generally $5 per cwt lower than last week's average, and viewed as generally disappointing given the wide gap between cash markets and beef values that remains. Bids are unavailable in all other areas, but may become more evident through the rest of the day. Asking prices remain at $107 to $108 live in the South and $178 to $180 dressed in the North. Boxed Beef cut-outs at midday are mixed, $0.31 higher (select) and down $1.08 (choice) with moderate movement of 56 total loads reported (42 loads of choice cuts, 9 loads of select cuts, no loads of trimmings, 5 loads of ground beef).
FEEDER CATTLE:
Strong triple-digit gains have moved into feeder cattle futures following a slow and sluggish start. This limited additional movement through the complex is bringing commercial traders back to the market who have been sitting on the sidelines over the last couple of weeks. The concern if these gains can hold into closing bell remains a valid one as prices posted strong early gains Wednesday, but faded quickly in the last hour of trade. The ability to regain market support through the end of August will continue to spark increased support through the entire cattle complex.
LEAN HOGS:
Firm triple-digit gains have continued to hold through lean hog futures despite unable to continue early morning market momentum. With December contracts trading above $65 per cwt, this moves prices to August highs, and officially, but narrowly breaks out of the sideways trading range seen over the last month. Although the underlying concern of global trade continues, the focus on domestic clearance is likely to spark renewed support through the near future. Cash prices are lower on the National Direct morning cash hog report. The weighted average price is down $1.90 at $57.93 per cwt with the range from $50 to $60.00 on 5,919 head reported sold. Pork values continue to weaken following additional sharp losses in primal cuts. Pork cutouts fell $1.53 per cwt at $70.48 per cwt with 177 loads traded. Lean hog index for 8/27 is $72.63, down 0.89, with a projected two-day index at $71.24, down 1.39.
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