DTN Midday Livestock Comments 01/16 12:19
Strong Gains Develop in Hog Trade Tuesday
Increased buyer support has quickly moved through the hog market, pushing
prices to triple-digit gains. Light support is holding in the cattle trade as
buyers focus on the ability to step back into the market following the long
By Rick Kment
Strong triple-digit gains are seen in hog futures which is helping to set
the tone for higher moving market activity across the complex. This may bring
increased trade volume to the market in all contract months through the next
few days. Corn prices are higher in light trade. March corn futures are 3/4
cent higher Tuesday. Stock markets are higher in light trade. The Dow Jones is
111 points higher while Nasdaq is up 5 points.
Narrow gains have slowly developed across the live cattle complex. The firm
gains in the entire livestock market has helped to bring some needed stability
to the market, although traders still remain uncertain just how much long-term
buyer support will continue to be seen over the near futures. Cash cattle
activity remains quiet as both sides step into the market and assess the
upcoming needs as well as the oddity of how last week's trade developed.
Although anything is possible, it is expected that active trade will not
develop until later in the week and break away from the previous shift to
early-week activity. This could help to put more focus on both beef values and
the direction of futures trade when packers and feeders come to an agreement.
Boxed beef cut-outs at midday are lower, $0.74 lower (select) and down $0.46
per cwt (choice) with light movement of 57 total loads reported (28 loads of
choice cuts, 14 loads of select cuts, 5 loads of trimmings, 10 loads of ground
Feeder cattle futures have posted light support following narrow gains in
the entire cattle complex. The front month gains of 65 cents per cwt has helped
to draw buyers into all contracts.
Strong triple-digit gains have developed across the lean hog futures complex
with nearby buying activity helping to drive additional support back into the
market. Nearby contracts are holding gains from $1 to $1.60 per cwt as traders
look past the recent pressure in cash markets and focus on developing increased
buyer support. It is uncertain if any additional trade will be seen, or if
prices will be able to move outside of the recent market range before closing
bell. Cash prices are lower on the National Direct morning cash hog report. The
weighted average price is down $0.34 at $69.49 per cwt with the range from
$63.00 to $70.00 on 3,148 head reported sold. Cash prices are lower on the
Iowa/Minnesota Direct morning cash hog report. The weighted average price is
down $1.18 at $68.86 per cwt with the range from $64.00 to $69.50 on 680 head
reported sold. The National Pork Plant Report posted 220 loads selling with
carcass values adding $0.36 per cwt. Lean hog index for 1/12 is at $71.15 up
$1.35 with a projected two-day index of $71.92, up $0.77.
Rick Kment can be reached at email@example.com
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