Strong losses have quickly developed in cattle
futures following the 11 a.m. (CT) release of the Cattle on Feed report.
This has added uncertainty to the entire market and puts additional
bearishness on the entire market. Some additional pressure is likely in
the last minutes of the abbreviated trading session. Hog futures remain
firm following light trade and moderate gains on the hogs and pigs
report. Corn prices are higher in light trade. March corn futures are 1
cent per bushel higher. Stock markets are lower in light trade. The Dow
Jones is 37 points lower while Nasdaq is down 14 points.
LIVE CATTLE:
There is additional pressure in live cattle
futures late Friday morning. The Cattle on Feed report released early
from the normal afternoon timeslot due to the upcoming holiday weekend
has posted a total on feed result of 108%. This is viewed as bearish for
the market due to increased overall placements during the month of
November. Front-month December futures are still holding a 7-cent per
cwt gain while the rest of the market is firmly lower with triple-digit
losses in most nearby contracts. Cash cattle markets remain dead quiet
without one bid or asking price redeveloping Friday morning. Both sides
are content with the business done before the Christmas break and
willing to wait until next week before additional interest is shown. It
is likely that next week's trade will remain sluggish also given the
holiday schedules the first week of January. Beef cutouts at midday are
higher, $0.97 higher (select) and up $0.98 per cwt (choice) with light
movement of 49 total loads reported (25 loads of choice cuts, 12 loads
of select cuts, two loads of trimmings, nine loads of ground beef).
FEEDER CATTLE:
Despite sluggish market activity early Friday,
markets turned sharply lower following the early release of the Cattle
on Feed report. This posted overall placements at 114% in the 12-state
category. This is likely to keep markets under pressure over the rest of
the trading session. Triple-digit losses are holding in all nearby
contracts with prices seen from $1 to $1.50 per cwt lower midday. The
fact that trade will not reopen until Tuesday is likely to create
additional uncertainty in the market.
LEAN HOGS:
Lean hog futures continue to hold light to
moderate buyer support due to limited trade activity on the holiday
shortened trading session. The quarterly Hogs and Pigs report was
released early Friday due to the holiday and abbreviated trading
schedule. This posted moderate gains in all categories. At this point,
the report is having a muted effect on the market with prices still 30
cents to 50 cents per cwt higher in late-day trade. Cash prices are
higher on the National Direct morning cash hog report. The weighted
average price is up $0.70 at $56.31 per cwt with the range from $50.00
to $57.20 on 3,198 head reported sold. Cash prices are unreported due to
confidentiality on the Iowa/Minnesota Direct morning cash hog report.
The National Pork Plant Report posted 131 loads selling with carcass
values falling $0.04 per cwt. Lean hog index for Dec. 20 is at $62.00
down $0.38 with a projected two-day index of $61.76, down $0.24.
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