Tuesday, July 11, 2017

Tuesday Midday Livestock Market Summary

GENERAL COMMENTS: 
Strong gains have flooded into the cattle market through late morning Tuesday, although the overall tone of the market has changed very little. Light trade volume is still seen across the market, allowing for traders to focus on increased market movement and buyers to fill the vacuum during the last half of the session. Hog futures have posted strong nearby gains following the spill over support in cattle trade, although deferred contracts remain under pressure, limiting widespread support. Corn prices are lower in light trade. July corn futures are 1 cent lower. Stock markets are lower in light trade. The Dow Jones is 12 points lower while Nasdaq is down 2 points.
LIVE CATTLE:
Firm buyer interest has moved back into the previously lightly traded live cattle complex with futures holding a 80 cent to $1 per cwt in nearby contracts. The focus on renewed support in futures trade comes as fundamental pressure still remains strong. The lack of movement across the complex early in the session seems to be the main spark that allowed buyers to quickly move back into the complex. This could bring about additional long term support to the market as well as underlying gains through the rest of the complex. Cash cattle markets remain at a standstill with bids and asking prices still unavailable at this point. It is likely that asking prices will develop over the next day or so, which could help to allow for increased bid activity through midweek. Active trade may not be seen until the last half of the week, and potentially Friday. Beef cut-outs at midday are lower, $0.81 lower (select) and down $1.86 per cwt (choice) with light movement of 82 total loads reported (32 loads of choice cuts, 23 loads of select cuts, 13 load of trimmings, 13 loads of ground beef).
Feeder Cattle:
Feeder cattle futures have rallied sharply higher through the morning Tuesday following sluggish narrow trade during the first hour of market activity. The inability to move market prices significantly in either direction through the first hour of trade sparked renewed buyer support to fill the vacuum as prices posted strong triple digit gains. Nearby contracts continue to hold gains of $1.50 to $1.80 per cwt with the focus on feeder cattle gains helping to spark additional support through the rest of the cattle complex.
LEAN HOGS:
Firm gains have developed across lean hog futures as the strong support seen in cattle trade as well as firmness in morning pork values has helped to spark additional buyer activity through the nearby contracts. July and August futures continue to lead the market higher with gains of 70 to 95 cents per cwt as traders focus on nearby contracts. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.82 at $85.69 per cwt with the range from $82.00 to $87.50 on 5,477 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct morning cash hog report. The weighted average price fell $0.67 at $86.98 per cwt with the range from $82.00 to $87.50 on 1,245 head reported sold. The National Pork Plant Report reported 170 loads selling with prices adding $0.29 per cwt. Lean hog index for 7/7 is at $92.46 up $0.06 with a projected two-day index of $92.46, unchanged.

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