DTN Midday Livestock Comments 03/24 11:58
Hog Futures Quickly Move Lower Friday Morning
Aggressive triple-digit losses have flooded through lean hog futures trade
Friday morning. This has quickly offset any sense of support seen in the
complex after the strong gains that developed Thursday. Cattle markets are
mixed in sluggish late-week trade.
By Rick Kment
Sharp losses have developed in lean hog futures trade as traders are quickly
backing away from any sign of support seen Thursday. Cattle markets are lightly
traded in mixed direction with very little activity seen through the morning.
Corn prices are lower in light trade. May corn futures are 1 cent lower. Stock
markets are higher in light trade. The Dow Jones is 14 points higher while
Nasdaq is up 33 points.
Live cattle futures remain focused on narrow trading ranges as most
commercial and investment traders have remained on the sidelines through the
end of the week. Some additional market shifts are expected in the last hour of
trade as traders prepare for the upcoming cattle on feed report. But the
overall direction of the market is not expected to be significantly changed
over the near future, but the direction of cash trade could bring additional
momentum to the market. Cash cattle markets have not traded yet Friday morning,
although bids have continued to develop in the South at $126 per cwt and $210
in the North. There are questions concerning just how much cash cattle trade
needs to, or will be done this week, as packers are increasingly sluggish when
it comes to chasing prices higher this week. Asking prices remain at $132 and
higher in the South and $217 to $218 in the North. Trade that does develop may
be seen around or after the release of the cattle on feed report Friday. Beef
cut-outs at midday are lower, $0.21 lower (select) and down $0.19 per cwt
(choice) with light movement of 68 total loads reported (36 loads of choice
cuts, 13 loads of select cuts, no loads of trimmings, 20 loads of ground beef).
Narrow trade ranges are holding in across the entire cattle complex, with
feeder cattle markets mixed following sluggish morning activity. Contracts are
hoovering from 35 cents lower to 25 cents per cwt higher at midday as traders
continue to look for additional direction from both live cattle trade and the
upcoming cattle on feed report. Very little activity is likely through the end
of the session, but the light volume adds price shifts based on just a few
traders still in the market.
Sharp triple-digit losses are seen in most lean hog contracts as traders
continue to adjust to the wild price shifts seen over the past week. Strong
gains seen Thursday have been eliminated with additional downside market
pressure seen across the complex. April futures are holding a $1.95 per cwt
loss, falling to $67.40 per cwt while May and June contracts are trading near
$2.50 per cwt lower. The one-day spike in price levels seen Thursday brought
more volatility into the market than anything else, with the overall tone of
the market still weak. Cash prices are lower on the National Direct morning
cash hog report. The weighted average price fell $0.56 at $64.47 per cwt with
the range from $60.00 to $66.00 on 2,264 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 122 loads selling with prices
gaining $1.57 per cwt. Lean hog index for 3/22 is at $71.29 down $0.12 with a
projected two-day index of $70.91 down $0.38.
Rick Kment can be reached at email@example.com
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