Thursday, March 22, 2018

Thursday Midday Livestock Market Summary - Early Cattle Gains Eroding Quickly

GENERAL COMMENTS: 
Cattle futures have posted strong early gains in the live and feeder cattle markets. However, a swift move away from the morning support has people wondering if prices will actually close lower. This is creating increased volatility in the lightly traded cattle complex late Thursday. Hog futures have posted firm losses with limited interest seen through the entire complex. Corn prices are lower in light trade. May corn futures are a 1/2 cent lower Thursday. Stock markets are lower in light trade. The Dow Jones is 440 points lower, while Nasdaq is down 129 points.
LIVE CATTLE:
Early gains in live cattle trade has helped bring buyer activity to the complex Thursday morning. Prices posted firm triple-digit support through most of the morning activity, although prices are starting to fade near midday. The inability to hold these early gains will create a significant market challenge for prices to move higher in the near future. Buyer support seemed to be firm, but the light trade activity can quickly be washed out of the market. There continues to be such a strong underlying bearish tone to the cattle complex that it is going to take aggressive buyer support in order to sustain early market rallies. Cash cattle interest is generally undeveloped Thursday morning. Although there could be some additional follow through activity moving into the market over the next couple of days, packers may have gained access to enough cattle to get through the upcoming holiday week. Bids are undeveloped in all areas Thursday morning, while asking prices on any cattle left for sale listed near $127-to-$128 live basis and $203 dressed. Trade seen early in the week has eroded market support given the pressure in futures activity. This is pushing prices generally $2-to-$5 per cwt lower than last week following the weaker Northern trade which developed Wednesday afternoon. Boxed Beef cut-outs at midday are higher, $1.77 higher (select) and up $1.33 per cwt (choice), with light movement of 47 total loads reported (35 loads of choice cuts, eight loads of select cuts, no loads of trimmings, three loads of ground beef).
FEEDER CATTLE:
Buyer support quickly moved back into feeder cattle as firming support seen early Thursday helped spark additional interest through the live cattle complex. Feeder cattle markets are holding firm triple-digit gains in all contract months at midday, although prices have slowly backed away from session highs due to limited trade volume. March cattle futures are holding a $1.02 per cwt gain. Current market support is essentially erasing the pressure seen in the complex Wednesday, but the sharp losses seen previously in the week continue to limit any long-term positivity
LEAN HOGS:
Strong morning buyer support in the cattle complex has had the opposite effect on hog trade during the morning. Strong triple-digit losses have quickly flooded through all nearby contracts as traders continue to focus on the inability to draw support or stability. Prices through October trade are holding triple-digit losses with June futures taking the lead, as prices have eroded $1.85 per cwt lower during morning activity. The inability to keep markets stable through the end of the week adds even more bearishness to the already weak market structure. Cash prices are unavailable at this time on the National Direct morning cash hog report. Cash prices are unavailable at this time on the Iowa/Minnesota Direct morning cash hog report. The National Pork Plant Report posted 185 loads selling with carcass values falling $0.32 per cwt. Lean hog index for 3/20 is at $63.63, down $0.66 with a projected two-day index of $63.03, down $0.60.

No comments:

Post a Comment