DTN Midday Livestock Comments 04/16 11:58
Strong Pork Gains Push Futures Higher
Sluggish mixed trade seen through most of the morning was replaced by strong
lean hog gains at midday. Active buyer interest quickly developed following a
strong surge in pork carcass values in the morning report.
By Rick Kment
Livestock futures remained very lightly traded through most of the morning
with prices stuck in a narrowly mixed range. But that quickly changed in lean
hog futures following aggressive support from pork values in the morning
report. This quickly drew buyers back into the market and pushed nearby futures
more than $1 per cwt higher. Cattle trade remains quiet with prices still stuck
in a narrowly mixed price range. Corn futures are lower at midday. May corn
futures are 5 cents per bushel lower. Stock markets are higher in light trade.
The Dow Jones is 114 points higher while Nasdaq is up 33 points.
Narrow price ranges have defined the live cattle complex Wednesday morning
with traders seemingly uninterested in stepping into the market at this point.
April and June contract months have bounced 22 cents per cwt higher at midday,
but compared to a normal price shifts, even this move may not be enough to draw
any additional attention to the market. The rest of the complex remains mostly
lower in a very narrow range as traders are looking for increased support from
outside markets as well as potential beef value support. Cash cattle markets
are testing the waters with a few scattered sales reported going to regional
packers in the North with prices at $150-per-cwt live basis. Bids are slowly
developing at $240 in the North dressed basis, but these are expected to be
from regional packers at this point too. Asking prices are holding at $149 to
$150 in the South and $243 and higher in the North. Beef cut-outs at midday are
higher, $0.82 per cwt higher (select) and up $0.30 per cwt (choice) with
moderate movement of 121 total loads reported (50 loads of choice cuts, 35
loads of select cuts, zero loads of trimmings, 36 loads of ground beef).
Feeder cattle are unable to show any life at all through the morning
Wednesday as prices are mixed within a single-digit price range over nearby
contracts. Slightly more aggressive pressure is seen in deferred futures
following softness in corn prices during morning trade. But overall, traders
seem to be overlooking the cattle market, in favor of hanging out on the
sidelines as mere observers.
Lean hog futures remained stable in a narrowly mixed price range through
most of the morning. But midday support in pork values, sparked additional
buyer support in all nearby contract months. June futures quickly went from
narrow losses to gains near $1 per cwt, with the potential to draw even more
support through the end of the trading session. The focus on higher pork values
may only have limited interest, given the short trading week, but for now the
kindle under the hog market has been rekindled. Cash prices are lower on the
National Direct morning cash hog report. The weighted average price fell $2.12
per cwt to $114.67 per cwt with the range from $105.00 to $115.47 per cwt on
3,056 head reported sold. Cash prices are unreported due to confidentiality on
the Iowa Minnesota Direct morning cash hog report. The National Pork Plant
Report reported 320 loads with prices adding $2.38 per cwt. Lean hog index for
4/14 is at $124.12 down 1.43, with a projected two-day index of $123.08 down
Rick Kment can be reached at email@example.com
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