Friday, April 12, 2019

Friday Morning Livestock Market Summary - Limited Buying Expected Early

#completeherdhealth
GENERAL COMMENTS: 
Cash activity in the North is expected to develop through the day, although bids and asking prices are likely to start out in a pattern similar to the one early in the week. Southern trade may be done for the week with Wednesday trade developing at steady money with week-ago price levels. This could spark some additional underlying moves in the entire complex. Firm end of the week activity is likely Friday morning, but prices may find it hard to sustain support through the end of the week. This could leave mixed price levels in both live cattle and feeder cattle trade Friday.
Lean hog futures are mixed following strong gains on Thursday. The sales announcement to China continues to be the big news for the hog complex. Although the sale was huge in itself, the fact that earlier expectations were confirmed was the main driver of market support Thursday. The fact that prices pulled back from limit gains is somewhat disappointing, as traders had already factored some of the support into the market. It is going to take continued underlying buying on a weekly basis in order to continue to support the lean hog futures complex at current or higher price levels. Cash trade is expected to be steady to $1 per cwt lower Friday morning with most bids steady to weak. Expected slaughter Friday is at 465,000 head. Saturday runs are expected at 68,000 head.
BULL SIDEBEAR SIDE
1) Continued underlying support in live cattle trade is helping to spark additional buying interest at the end of the week.1) Wholesale beef values have remained stuck in a sideways range, limiting the underlying support likely to develop through the rest of spring. This may weaken overall trade through the end of April.
2) Traders are looking for end of the week support from cash trade. Most of the business is likely done in the South following midweek activity, but trade in the North still needs to develop, which could be an opportunity to post late-week cash market support.2) Limited direction in feeder cattle trade through the end of the week is making it difficult to spark additional underlying buyer support. This may keep prices in a narrow-to-moderate trading pattern, limiting gains over the next couple of months.
3) The aggressive China sale of pork products reported on the export sales report is sparking additional interest. This may add increased support to futures prices Friday.3) The fact that prices quickly fell away from limit gains Thursday is opening the door for market disappointment despite aggressive sales to China.
4) Pork prices continue to be lightly supported, but the focus on potential long-term export demand is likely to bring additional buying interest into the complex.4) Cash hog prices are struggling to remain stable despite the aggressive upward move in most futures trade. This continues to showcase the disconnect between spot market activity and futures trade through early April.








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