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DTN Midday Livestock Comments          10/27 11:38

   Triple-Digit Gains Hold Across Livestock Complex               

   Strong gains have developed in livestock markets as traders continue to 
focus on follow-through buyer support moving into the complex. Firm commercial 
interest is seen in nearby cattle and hog contracts Thursday morning, pushing 
prices to triple-digit gains.        

By Rick Kment
DTN Analyst


   Strong gains have developed across livestock futures with nearby futures 
holding gains from $1 to $1.50 per cwt support in cattle and hog trade at 
midday. The ability to continue to draw support into the market consistently 
through the market may continue to spark additional buyer activity into the 
complex. Corn prices are higher in light trade. December corn futures are 5 
cents higher per bushel. Stock markets are mixed in light trade. The Dow Jones 
is 50 points higher while Nasdaq is down 21 points.


   Firm buyer support has quickly moved back into the market early Thursday 
morning as additional commercial buying has flooded back into the complex. The 
ability to aggressively draw additional open interest to the market is sparking 
additional interest in nearby and deferred contracts, and pushing nearby prices 
to triple-digit gains. Even though gains are holding, little new support is 
seen in the market through midday with October live cattle futures holding a 
$1.50 per cwt gain, near the price level seen during most of the morning. Cash 
cattle markets are starting to firm with bids quickly developing through the 
morning Thursday. Bids in the South are seen from $102 to $104, which is steady 
to $2 per cwt higher than last week. Northern bids are seen at $160 at this 
point. Asking prices are seen at $105 to $105 in the South and $165 and higher 
in the North with no sign that feeders will pull back from those levels at this 
point. Trade may be delayed until sometime Friday. Beef cut-outs at midday are 
mixed $0.08 higher (select) and up $0.78 per cwt (choice) with moderate 
movement of 93 total loads reported (40 loads of choice cuts, 37 loads of 
select cuts, 7 loads of trimmings, 9 loads of ground beef). 


   Strong buyer support once again develops in feeder cattle futures with 
triple-digit gains developing in most feeder cattle contracts. November 
contracts are trading at $125 per cwt holding at $1.07 per cwt rally at midday 
following the triple digit rally seen through the nearby live cattle market. 
The underlying firm support seen through the entire week in cattle trade 
continues to draw firm but consistent commercial support as traders have moved 
from contract lows and are making the case for a strong market rally that could 
gain additional momentum through the next couple of weeks if additional cash 
market support develops.  


   Trade across the lean hog complex remains sluggish at midday as gains 
continue to hold through the morning. Even though prices have backed slightly 
away from session highs due to the lack of trader intensity moving into the 
market, the ability to keep prices hovering over triple digit gains in nearby 
contracts is helping to sustain market support and likely bring about 
additional long term stability through the complex. December futures are 
trading above $45 per cwt for the first time since late September, which 
continues to move away from contracts lows of $41.10 per cwt. Each trading 
session that traders can remove themselves from that level, makes it easier to 
break the trend and look forward to shifting toward a new market direction 
through the month of November. Cash prices are lower on the National Direct 
morning cash hog report. The weighted average price fell $0.59 per cwt to 
$44.22 per cwt with the range from $43.00 to $45.50 on 6,528 head reported 
sold. Cash prices are higher on the Iowa Minnesota Direct morning cash hog 
report. The weighted average price gained $0.23 per cwt to $45.24 per cwt with 
the range from $43.00 to $45.50 on 2,655 head reported sold. The National Pork 
Plant Report reported 206 loads selling with prices slipping $0.02 per cwt. 
Lean hog index for 10/25 is at $51.70 up $0.03 with a projected two-day index 
of $51.85 up $0.15. 

   Rick Kment can be reached at 


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