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DTN Midday Livestock Comments          11/24 12:06

   Cattle Futures Slide Sharply Lower 

   Lack of support quickly overwhelmed the cattle complex Monday morning, 
eroding initial support in nearby contracts. This drew additional pressure back 
into the complex, which is embracing triple-digit losses in both live cattle 
and live cattle contracts.   

By Rick Kment
DTN Analyst



GENERAL COMMENTS: 

   Wide price swings have quickly developed through the livestock complex with 
aggressive triple-digit losses seen in both the live cattle and feeder cattle 
market. Lean hog trade remains firm with buyer still holding with strong nearby 
gains in tact, although gains are well off of early session highs. Corn prices 
are lower in light trade. December corn futures are 3 cents per bushel lower. 
Stock markets are mixed in light trade. The Dow Jones is 10 points lower while 
Nasdaq is up 30 points.

   LIVE CATTLE:

   Early support seen in live cattle futures was short-lived as pressure is 
brewing in deferred contract months seemed to overtake the entire complex. This 
has led to moderate to strong triple digit losses at midday as traders remain 
concerned about short term buyer interest stepping back into the market ahead 
of the holiday weekend. It is uncertain just how much impact the losses Monday 
will have on the rest of the week, or fundamental market direction as feedlot 
managers remain focused on recent market strength. Cash cattle markets remain 
quiet although show lists are reported as generally larger for the week. It is 
likely that both sides will desire to get sales recorded by the end of the day 
Wednesday, but it is uncertain if this will happen. Asking prices and bids are 
still not fully defined, although the initial tone if firmer than last week's 
levels. Beef cut-outs at midday are higher, $0.25 higher (select) and up $1.18 
per cwt (choice) with light movement of 65 total loads reported (26 loads of 
choice cuts, 13 loads of select cuts, seven loads of trimmings, 19 loads of 
ground beef).

   FEEDER CATTLE:

   Sharp losses have developed through the cattle complex as any limited 
support seen in the early trade quickly eroding as additional volume stepped 
back into the market. Traders are looking for additional direction through 
late-day trade, although at this point it is going to be extremely difficult to 
spark any interest from buyers to step back into the aggressively bearish 
market tone. The higher than expected cattle placements are having a delayed 
impact as traders once again look at the light volume that is stepping back 
into the market.  

   LEAN HOGS:

   Firm support is holding through the lean hog futures market with traders 
focusing on the ability to draw traders back into the complex over the next few 
days surrounding the holiday season. December contracts are leading the market 
higher, with gains of $1.07 per cwt, although volume remains light, and is 
likely to continue that way over the rest of the session. Cash prices are lower 
on the National Direct morning cash hog report. The weighted average price fell 
$1.28 per cwt to $83.83 per cwt with the range from $83.62 to $86.00 per cwt on 
2,585 head reported sold. Cash prices are unreported due to confidentiality on 
the Iowa Minnesota Direct morning cash hog report. The National Pork Plant 
Report is reported 167 loads selling as prices gained $0.26 per cwt. Lean hog 
index for 11/20 is at $88.86 down $0.09, with a projected two-day index of 
$88.78 down 0.08.

   Rick Kment can be reached at rick.kment@dtn.com 


(SK)

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