DTN Midday Livestock Comments          11/15 12:10

   Firm Gains Develop Thursday 

   Buyer support has steadily improved through the morning with firm gains seen 
in cattle and hog futures. Underlying fundamental buyer support is holding at 
midday with prices at or near $1 per cwt in nearby contracts.

By Rick Kment
DTN Analyst

General Comments

   Buyer support is seen in cattle and hog markets Thursday morning with trade 
activity focusing on the potential for increased fundamental support through 
the next couple of days. Hog futures are leading the complex higher with a $1 
per cwt gain seen in nearby trade. Corn markets are higher in light trade. 
December corn futures are 2 cents higher. Stock markets are mixed in light 
trade. The Dow Jones is 41 points lower while Nasdaq is down 50 points.

   LIVE CATTLE:

   Limited activity has been seen through the entire live cattle complex with 
nearby trade holding gains of 50 to 60 cents per cwt, while sluggish moves in 
deferred contracts is helping to add to the building support. With buyers 
trying to regain momentum following light to moderate pressure that developed 
Wednesday, the focus on the complex remains stable as traders are still 
confined in a wide sideways long term range. Although markets are trying to 
build off of early week support, it appears that narrow market shifts may hold 
in the near future. Cash cattle markets are showing more activity with packers 
becoming more active midmorning Thursday. Bids are now evident in all areas 
with bids from $109 to $113 live and $176 dressed. Asking prices have also 
become more evident, still well above current bids at $116 to $117 live basis, 
and $178 to $180 dressed. It is likely that more market focus will be seen as 
more activity moves into the complex through the rest of the day. But it is 
likely that active trade may not develop until sometime Friday. Boxed Beef 
cut-outs at midday are higher, $1.27 higher (select) and up $0.21 per cwt 
(choice) with light movement of 60 total loads reported (23 loads of choice 
cuts, 12 loads of select cuts, 10 loads of trimmings, 15 loads of ground beef).

   FEEDER CATTLE:

   Limited trade is seen in feeder cattle futures early Thursday with lightly 
traded front-month November contracts holding a 32 cent per cwt loss. Firm 
gains seen through the rest of the complex, has helped to solidify buyer 
support with most contracts trading in a narrow pattern from 50 to 70 cents per 
cwt. The underlying buyer activity moving into the market despite firming grain 
market prices is pointing to longer-term demand support in beef values and the 
potential to spark additional commercial and investment trade through the end 
of the year.

   LEAN HOGS:

   Firm buyer support has quickly stepped back into the complex with traders 
focusing on triple digit gains seen in February through April contracts. The 
ability to spark renewed support in the February contract, moving price $1.20 
per cwt higher as fundamental support is seen following higher cash hog prices 
in the morning report. The ability to expand on gains over the last week is 
helping to spark some additional interest through all nearby contracts. There 
is growing support in all nearby contracts, despite the limited pressure 
redeveloping in deferred futures as traders try to square previous positions. 
Cash prices are higher on the National Direct morning cash hog report. The 
weighted average price is $0.76 higher at $52.11 per cwt with the range from 
$46.00 to $52.44 on 3,409 head reported sold. Cash prices are unreported due to 
confidentiality on the Iowa/Minnesota Direct morning cash hog report. The 
National Pork Plant Report posted 223 loads selling on the morning report. Pork 
carcass values added $0.59 per cwt at $69.61 per cwt. Lean hog index for 11/13 
is $60.47, down 0.73, with a projected two-day index of $59.86, down 0.61. 

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


(CZ)

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