GENERAL COMMENTS:
Live cattle futures are showing the most weakness Wednesday morning with early losses holding and erasing most, if not all of Tuesday's gains. Feeder cattle futures seemed to be able to maintain at least some market momentum during the first couple hours of trade, but midday losses are pushing prices mostly lower through feeder cattle trade also.
Hog futures have posted narrow to moderate gains as traders cover short positions seen the previous day. Lack of new market information which will change the course of both cattle and hog futures trade continues to be the main challenge to stimulate buyer interest through all trade.
March corn is down 5 1/4 at $4.853 and January soybean meal is down $7.80 at $410.00. The Dow Jones Industrial Average is up 15.00 at 36,139.56.
LIVE CATTLE:
Live cattle futures have led the market lower Wednesday morning with February futures setting the tone for the morning market losses as prices are hovering around $2 per cwt lower for the day. These price moves have essentially evaporated any price support seen during the Tuesday session. If prices continue to hold current losses, this would establish new multi-month lows in the complex and add even more weakness to the entire complex. The continued weakness in market technical factors is limiting buyer interest from stepping back into the complex heading into the end of the year.
Cash cattle trade is starting to develop Wednesday morning with live deals in the south seen at $171 per cwt. This is steady with the very light scattered trade Tuesday, but $3 per cwt lower than last week's weighted average. Northern trade is seen at $271 per cwt dressed basis. These prices are steady to weak from the limited sales seen Tuesday, but $4 per cwt below last week's weighted average. Although more trade is still expected to develop through the week, the overall softness in the entire market could mean the overall price tone for the week may be set at this point.
Asking prices on cattle still available remain near last week's price levels at $275 per cwt dressed and $175 per cwt live basis. December live cattle are $1.68 lower at $166.825, February live cattle are $1.90 lower at $167.075, April live cattle are $1.38 lower at $170.125.
Boxed beef prices are mixed: choice down $2.31 ($291.44) and select up $0.58 ($259.71) with a movement of 129.12 loads (82.82 loads of choice, 19.64 loads of select, 16.86 loads of trim and 9.80 loads of ground beef).
FEEDER CATTLE:
Feeder cattle futures remain mixed Wednesday morning with the strong, triple-digit support that developed Tuesday unable to be maintained, in part to the continued cash market weaknesses and softness in live cattle futures. January futures are holding moderate gains based on recent market shifts, but March through October contracts are holding moderate to firm losses with the most aggressive pressure seen in deferred contract months.
Currently, it appears that Tuesday's sharp gains are still able to hold the market above recent support levels, but continued weakness in other commodity markets and live cattle trade could limit longer term support moving into the feeder cattle complex in the coming days.
January feeders are $0.43 higher at $215.125, March feeders are $0.38 lower at $217.1 and April feeders are $0.55 lower at $220.825.
LEAN HOGS:
Lean hog futures are trading mostly higher midday Wednesday as consistent short-covering is starting to develop midweek across the complex. The bounce higher in early cash trade reports is being offset by pressure in pork values, but traders are still trying to build some much-needed consistency through the entire complex.
Given the moderate price shifts over the last few trading sessions, the lean hog complex remains comfortably locked into a sideways trading pattern. This could limit additional wide market shifts over the near future. December lean hogs are $0.65 higher at $67.475, February lean hogs are $0.18 higher at $69.525 and April lean hogs are $0.10 lower at $76.00.
Hog Prices are higher on the Daily Direct Morning Hog report, up $0.93 with a weighted average of $54.89, ranging from $52.00 to $58.00 on 8,247 head with a five-day rolling average of $55.44. Pork Cutouts totaled 209.21 loads with 175.30 loads of pork cuts and 33.91 loads of trim. Pork cutout values are down $0.44 at $83.79.
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