GENERAL COMMENTS:
Limited activity is seen in livestock trade Friday morning as traders focus on narrow market adjustments following what has been a turbulent two weeks of shifts in cattle and hog trade. Nearby live cattle futures are holding single-digit gains, while the rest of the cattle complex is focused on taking positions ahead of the weekend. Even though trade volume is light Friday, the early week market shifts appear to be holding. December corn is up 2 3/4 cent per bushel and December soybean meal is up $1.60 per ton. The Dow Jones Industrial Average is up 45 points with Nasdaq down 14 points.
LIVE CATTLE
Live cattle futures have broken away from the active price gains seen earlier in the week. Mixed trade within a narrow range is holding at midday, which will likely keep markets stable through the end of the session. Narrow follow-through support is seen in October through February contracts, while other deferred contracts are posting single-digit losses. Similar to feeder cattle trade, live cattle futures have been unable to break above the 40- or 100-day moving average price levels, leaving the market still vulnerable to another round of pressure early next week. Next week's moves in wholesale beef values and cash markets will likely be extremely important in helping to sustain further commercial buyer support. Cash cattle markets remain generally quiet Friday morning with the bulk of expected trade already on the books following moderate to active trade seen earlier in the week. Reports of a few cattle sold in Colorado at $124 per cwt are seen Friday morning -- this is not unexpected and would be steady with trade already seen during the week. Trade in the South developed at mostly $124 per cwt -- this is steady with last week's Texas trade, but $1 higher than the weekly average in Kansas, and even though overall sales totals and averages are still unavailable, the tone is steady to firm with last week's market. Trade in the North developed at $196 dressed basis, and $122 to $124 live basis -- this is fully steady with last week. A few more clean-up deals may be reported before the end of the week, but at this point, any additional activity in the market is not expected to have a significant role on overall price levels, or trade direction heading into next week.
Friday morning's boxed beef prices are mixed in light trade, with choice cuts $1.25 lower at $284.06 and selects up $0.90 at $265.34 on a total count of 62 loads. Dow Jones estimated Friday's cattle slaughter at 116,000, steady with a week ago and 5,000 more than year-ago levels.
FEEDER CATTLE
Narrow losses have trickled into feeder cattle futures as traders adjust positions ahead of the weekend break. October feeder cattle contracts have rallied $8 per cwt over the last week, creating additional underlying support through the complex as buyer support has temporarily paused during late week activity. With nearby contracts hovering just below the 40- and 100-day moving average price levels following the week's market gains. Price direction early next week will be significant in directing the longer-term support available in the entire cattle complex. Even though seasonal lows are expected to have been logged over the last two weeks, there remains uncertainty about how much upward momentum remains during the rest of October. The CME Feeder Cattle Index was priced at $153.80 for Oct. 6.
LEAN HOGS
Lean hog futures have stabilized Friday following early week market pressure. Following an extremely wild and volatile market shift over the last two weeks, which posted a $12 per cwt price swing, it appears the spot October lean hog futures are solidifying at $90 per cwt, which is $10 per cwt above September lows. The focus on tighter hog supplies is helping to sustain current buyer support at the end of the week, although active gains are likely to be delayed until next week when additional volume moves into the complex. Moderate pressure is seen in pork cutout values at the end of the week. Cutouts are down $2.35 at $109.91 Friday morning on 183.47 loads. Negotiated hog prices are $0.80 lower at $69.06 per cwt on 6,166 head. The swine/pork market formula price is listed at $91.84 per cwt. Dow Jones estimated Friday's hog slaughter at 476,000, 3,000 more than a week ago, while 9,000 less than year ago levels. Expected Saturday runs are 224,000 head. The CME Lean Hog Index is listed at $92.59 per cwt for Oct. 7.
No comments:
Post a Comment