Tuesday, September 19, 2017  

 
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DTN Midday Livestock Comments          09/19 12:07

   Gains in Hog Trade Spark Additional Buyer Interest         

   Strong underlying support has moved into the lean hog futures complex as 
December contracts have held $1 per cwt gains at midday. Mixed cattle trade 
comes as firm follow-through buyers flood back into the feeder cattle market 
while live cattle markets remain mixed in a narrow range.  

By Rick Kment
DTN Analyst

GENERAL COMMENTS: 

   Firm buyer activity has held through lean hog and feeder cattle trade at 
midday Tuesday. This overall support in the complex has brought about increased 
overall market support to most livestock trade, although volume remains 
sluggish Tuesday. Live cattle markets have not been swept into the buying 
support with prices mixed in an extremely narrow range. Corn prices are lower 
in light trade. December corn futures are 4 cents lower. Stock markets are 
higher in light trade. The Dow Jones is 46 points higher while Nasdaq is up 5 
points.

   LIVE CATTLE:

   Live cattle futures are holding in a narrow trading range at midday with 
prices 20 cents lower to 5 cents higher. The narrow market range seen during 
the entire morning as well as overall lack of direction seen Monday is causing 
some caution to the market as traders are starting to focus on the change in 
direction from the live cattle market and the feeder cattle complex. This may 
spark some additional volatility through the end of the week, but for now, 
markets seem to be well rooted with narrow market moves. Cash cattle activity 
remains quiet with bids undeveloped yet this week. There are a few scattered 
asking prices starting to be seen in the South at $108 to $109, but these are 
not expected to get much attention at this point. Asking prices are likely to 
start out from $171 to $173 in the North. It would not be surprising if markets 
remain quiet until the last half of the week, with active trade being pushed 
into sometime Thursday or Friday. Beef cut-outs at midday are higher, $1.13 
higher (select) and up $0.21 per cwt (choice) with light movement of 81 total 
loads reported (44 loads of choice cuts, 13 loads of select cuts, 14 loads of 
trimmings, 11 loads of ground beef). 

   FEEDER CATTLE:

   Firm commercial buyer interest continues to hold on in feeder cattle trade 
despite slight pressure in the live cattle complex. This overall support is 
focused on nearby markets which have backed away slightly from early gains and 
are trading at 20 to 35 cents per cwt higher. The overall strong support seen 
in feeder cattle trade is taking the market by surprise as overall market 
fundamentals would not suggest an aggressive market rally at this point. 

   LEAN HOGS:

   Strong midday gains have continued to be seen through the lean hog complex 
with traders focusing on strong triple digit gains developing in December 
contracts. The overall support through the market has helped to hold October 
contracts above the $60 per cwt price level, which is limiting any pressure 
from redeveloping. The most aggressive market firmness is seen in December 
through May contracts. Cash prices are lower on the National Direct morning 
cash hog report. The weighted average price fell $0.89 at $51.24 per cwt with 
the range from $49.00 to $53.00 on 13,468 head reported sold. Cash prices are 
lower on the Iowa/Minnesota Direct morning cash hog report. The weighted 
average price fell $0.74 at $51.43 per cwt with the range from $51.00 to $52.50 
on 9,485 head reported sold. The National Pork Plant Report reported 263 loads 
selling with prices falling $1.97 per cwt. Lean hog index for 9/15 is at $62.82 
down $1.25 with a projected two-day index of $61.88, down 0.94. 

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


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