Strong triple digit gains have quickly developed
through cattle futures at midday. This aggressive buyer support is
being led by the feeder cattle complex at the end of the week, which is
helping to post a $2 to $2.30 per cwt rally in nearby contracts.
Follow-through buyer support is aggressively moving into the live cattle
market as both sides of the market quickly move back into the complex.
Corn prices are higher in light trade. September corn futures are 3
cents higher. Stock markets are mixed in light trade. The Dow Jones is
higher points lower while Nasdaq is down 24 points.
LIVE CATTLE:
Spillover buying is moving into the live cattle
complex following aggressive support in the feeder cattle complex as
well as firm support from live cattle commercial interest also
developing alongside the feeder cattle market. Front month October
futures are holding gains of $1.60 per cwt, holding at $107.87 per cwt
through the Friday session, while additional support is moving into the
December contracts, pushing contracts $1.90 per cwt higher above $113
per cwt at midday. The premium being placed in the December through
April contracts is helping to spark additional market support over the
last couple of weeks, driving increased commercial and investment
interest into the complex. Cash cattle markets are slow to develop
Friday morning even though bids have developed in all areas. Bids are
seen in similar ranges as previous days at $101 to $102 live and $163
dressed. But at this point no one has been willing to pull the trigger.
Asking prices remain at $107 to $108 live and $168 to $170 dressed. The
gap needs to close in order for business to get done, and time is
running out for this to get accomplished. Beef cut-outs at midday are
slightly higher, $0.02 higher (select) and up $0.09 per cwt (choice)
with light movement of 97 total loads reported (53 loads of choice cuts,
23 loads of select cuts, 5 loads of trimmings, 16 loads of ground
beef).
FEEDER CATTLE:
Strong triple-digit gains have one again flooded
into feeder cattle futures, creating momentum through the entire cattle
complex at the end of the week. This rally has pushed nearby contracts
to $148 per cwt which has broken through short-term highs, set on August
15, at $146.75 per cwt. In front month September contracts. A weekly
close above these levels is expected to draw additional support back
into the complex early next week and through the middle of September.
LEAN HOGS:
Trade remains mixed at midday across lean hog
futures with buyers holding onto the expectation that overall buyer
support will prevail by the end of the trading session. But the
inability to hold firm cash hog values or pork values in morning reports
has limited the support through the complex and is creating some midday
market apathy. Nearby contacts are steady to 10 cents higher, although
the tone of the market remains stable at best at this point. Cash prices
are lower on the National Direct morning cash hog report. The weighted
average price fell $1.46 at $58.56 per cwt with the range from $55.00 to
$60.00 on 2,514 head reported sold. Cash prices are unreported due to
confidentiality on the Iowa/Minnesota Direct morning cash hog report.
The National Pork Plant Report reported 155 loads selling with prices
falling $0.03 per cwt. Lean hog index for 9/6 is at $69.37 down $0.96
with a projected two-day index of $68.43, down $0.43.
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