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DTN Midday Livestock Comments          05/05 11:46

   Cattle Futures Turn Lower During Midday Trade               

   Strong losses which have developed in nearby feeder cattle futures have 
quickly impacted previous support through live cattle trade. This has helped to 
push prices lower across cattle futures with the concern that longer term 
support may be starting to be limited. 

By Rick Kment
DTN Analyst


   Early support seen through the entire livestock market has narrowed 
significantly as cattle futures have turned lower during late morning trade. 
The focus on firming cash hog markets and strong demand support is keeping 
nearby lean hog futures higher, while the entire cattle complex has slipped 
lower, looking for renewed direction. Corn prices are lower in light trade. May 
corn futures are 2 cents per bushel lower. Stock markets are lower in light 
trade. The Dow Jones is 58 points lower while Nasdaq is down 54 points.


   Light to moderate pressure has trickled into the live cattle complex as 
traders quickly back away from the feeder cattle market and very little 
additional support was seen through beef values. Even with the lower prices, it 
is expected that nearby summer contracts may continue to remain stuck in the 
current rut, between $149 and $151 per cwt as traders look for additional 
demand support which may help to draw buyers back into the complex. Cash 
markets remain quiet with bids still undeveloped. It is expected that at least 
token bids may develop through midweek, although active trade may be delayed 
until late in the week. Beef cut-outs at midday are higher, $0.36 higher 
(select) and up $1.33 per cwt (choice) with light movement of 98 total loads 
reported (39 loads of choice cuts, 34 loads of select cuts, 7 loads of 
trimmings, 18 load of ground beef).


   What started out as strong morning buyer support has steadily eroded through 
the session as traders are now looking at moderate to strong losses near 
midday. The overall lack of new market information seems to have allowed 
traders to once again focus on the lack of follow through strength in cash and 
beef values, as well as inability of live cattle futures to break out of the 
current price range around $150 per cwt. This could add additional late day 
pressure through the entire feeder cattle complex, although the overall tone of 
the market may take more time to change significantly. 


   Moderate to strong gains continue to hold in nearby contracts, with the 
strongest price support seen in the extremely lightly traded May contract which 
is holding a $2 per cwt rally. The few traders who are in the May contract 
month are trying to catch up to the support seen over the last few sessions in 
other summer contract. June through August futures are holding between $82 and 
$83 per cwt based on recent cash market support, as buyers continue to steadily 
step into the complex. Cash prices are lower on the National Direct morning 
cash hog report. The weighted average price fell $0.80 per cwt to $73.24 per 
cwt with the range from $64.00 to $76.00 per cwt on 3,973 head reported sold. 
Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The 
weighted average price added $0.17 per cwt to $75.57 per cwt with the range 
from $67.50 to $76.00 per cwt on 872 head reported sold. The National Pork 
Plant Report is reported 186 loads selling as prices added $0.61 per cwt. Lean 
hog index for 4/30 is at $69.49 up 1.33, with a projected two-day index of 
$71.17 up 1.68.  

   Rick Kment can be reached at 


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