GENERAL COMMENTS:
Mixed trade is seen through the livestock futures complex with moderate follow-through gains developing in live cattle futures while feeder cattle and lean hog futures have posted morning losses. The break away from wide triple digit market swings seen across the complex over the past couple of weeks is a breath of fresh air, and hopefully this will give traders and market watchers alike the opportunity to be able to break out of the emotionally driven market moves which have created such pressure in the cattle complex in the recent weeks.
The ability to build on early week market moves may help to not only support price levels, but also bring more buyer interest into the market through the last half of the month despite the upcoming holiday breaks.
March corn is down 3 3/4 at $4.818 and January soybean meal is up $7.20 at $411.9. The Dow Jones Industrial Average is up 61.06 at 36,308.93.
LIVE CATTLE:
Live cattle futures are the bright spot Monday morning with light but supportive follow-through buying moving into all contract months during morning trade. The inability to follow Friday's aggressive triple-digit gains is not viewed as concerning as this move helps support last week's move higher.
The live cattle market remains significantly depressed, which may limit additional consistent buyer activity over the near future. But if prices can build on recent support levels and develop additional technical and fundamental support moving into the end of the year, additional gains are likely to be seen.
Cash cattle markets are still quiet Monday morning with show list distribution and inventory the main order of business. The fact that most trade last week was accomplished in the first half of the week could bring some earlier than expected market activity. But at this point, it is not expected that trade will become active Monday.
With prices falling firmly lower over the last few weeks, the ability to bring a sense of stability to cash markets will be huge and will likely keep feeders aggressive once asking prices are listed.
December live cattle are $0.25 higher at $165.7, February live cattle are $0.40 higher at $166.125, April live cattle are $0.35 higher at $169.65.
Boxed beef prices are higher: choice up $2.44 ($290.45) and select up $3.05 ($260.95) with a movement of 62.86 loads (32.70 loads of choice, 9.34 loads of select, 16.90 loads of trim and 3.92 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures have shifted lower at midday, although the majority of Friday's aggressive upward gains are able to hold. Light to moderate gains in live cattle futures and a general tone of stability is seen Monday morning, which is a significant shift from market moves over the past couple of weeks. The ability to even keep market losses at a minimum through the end of the session could help to build increased confidence throughout the entire complex over the next few trading days.
January feeders are $0.80 lower at $214.5, March feeders are $0.75 lower at $215.325 and April feeders are $0.48 lower at $218.725.
LEAN HOGS:
Lean hog futures remained generally quiet through most of the morning, although firm selling pressure is seen spot month February contracts. There is expected to be increased market concern that long-term pork demand growth, especially in export markets may be limited due in part to still growing pork supplies in China. The lean hog complex is still holding a sideways trading pattern, although prices remain in the bottom 1/3 of recent market ranges, which could limit additional technical support in the near future.
December lean hogs are $0.35 lower at $68.075, February lean hogs are $2.15 lower at $66.825 and April lean hogs are $1.35 lower at $74.80. Hog Prices are unreported due to confidentiality on the Daily Direct Morning Hog report. Pork Cutouts totaled 179.00 loads with 162.26 loads of pork cuts and 16.74 loads of trim. Pork cutout values are up $4.41 at $85.76.
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