Strong gains have developed in nearby contracts
in all livestock futures. Gains above $1 per cwt is helping to bring
some additional underlying support back into the market despite the
limited trade activity seen Friday morning. Corn prices are higher in
light trade. July corn futures are 1 cent higher. Stock markets are
higher in light trade. The Dow Jones is 63 points higher while Nasdaq is
up 2 points.
LIVE CATTLE:
Firm to strong buyer support has redeveloped in
live cattle trade late Friday morning. This is helping to bring even
more activity back into the complex. June futures are trading above $109
per cwt with $1.10 per cwt gains, while August futures are $1.50 per
cwt higher. The focus on potential support in cash markets is helping to
bring some light underlying support to the complex, although there is
concern that traders may take a more casual approach early next week.
This may cause some additional market volatility due to very light
activity. Cash cattle bids have started to increase through the morning,
although offers are not significantly changed from earlier in the week.
Bids are seen at $110 live basis and $180 to $181 dressed. Asking
prices have remained firm at $115 and higher live and $185 dressed.
Trade should develop through the early to mid-afternoon. Boxed Beef
cut-outs at midday are higher, $1.20 higher (select) and up $0.18 per
cwt (choice) with light movement of 68 total loads reported (33 loads of
choice cuts, 17 loads of select cuts, 8 loads of trimmings, 9 loads of
ground beef).
FEEDER CATTLE:
Strong feeder cattle futures are seen late
Friday following sluggish mixed trade earlier in the session. August and
September contracts are holding gains of $1 to $1.40 per cwt. The buyer
interest is being driven by the support in live cattle trade. This may
add increased overall support to the complex. Narrow gains are seen in
deferred contracts as this buying is focused on spill-over interest from
nearby contracts as most traders seem comfortable with the current
market direction.
LEAN HOGS:
Strong late-week gains have quickly developed
across the complex with futures holding $1.40 to $1.65 per cwt gains
through midday. Although limited trade activity is seen through all
other contracts in deferred months posted narrowly mixed trade with
prices from 15 cents lower to 15 cents higher. The light activity seen
across the complex should continue to support nearby buying activity
through the end of the session. Cash prices are higher on the National
Direct morning cash hog report. The weighted average price is up $0.93
at $76.34 per cwt with the range from $70.00 to $79.00 on 5,170 head
reported sold. Cash prices are higher on the Iowa/Minnesota Direct
morning cash hog report. The weighted average price is up $0.69 at
$77.34 per cwt with the range from $70.00 to $79.00 on 3,682 head
reported sold. The National Pork Plant Report posted 147 loads selling
with carcass values gaining $0.94 per cwt. Lean hog index for 6/06 is at
$73.50 up 1.00 with a projected two-day index of $74.57, up 1.07.
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