Follow-through pressure is seen in April hog trade with prices breaking through long-term support. This creates additional long-term concerns about upcoming buyer interest. Mixed trade ranges are seen in cattle and hog futures with limited activity developing.
Limited trade is seen Monday morning with mixed trade seen during morning activity. April lean hog futures are leading the hog complex lower with a 32 cent per cwt loss with contracts setting contract lows through the morning. Light support in feeder cattle trade is causing live cattle futures to remain mixed although trading ranges have remained very narrow.
Corn markets are lower in light trade. March corn futures are 1 1/2 cents lower. Stock markets are mixed in light trade. Dow Jones is 12 points lower with Nasdaq up 20 points.
Narrow trading ranges have held Monday morning in all live cattle trade. This is keeping prices 7 cents lower to 20 cents higher midday as inactivity in the complex is evident. Strong gains in beef values and the cash market support seen last week has yet to create significant futures market activity as traders continue to focus on the overall outside market direction with questions looming around a long term budget deal to keep the government running and trade negotiations with China.
Cash cattle interest is slow Monday morning with bids and asking prices yet to be developed. Most of the focus is being placed on inventory taking and show list distribution across cattle country. It is likely to be midweek before active bids are seen, with trade expected to be pushed to the last half of the week.
Boxed Beef cut-outs at midday are higher, $2.05 higher (select) and up $1.14 per cwt (choice) with light movement of 35 total loads reported (20 loads of choice cuts, 5 loads of select cuts, 5 loads of trimmings, 5 loads of ground beef).
Light buyer support is slowly moving back into feeder cattle trade. Continued pressure in corn trade has allowed for renewed follow-through support to develop in most feeder cattle trade, although most contracts are 10 to 30 cents per cwt higher. The underlying firm tone in the cattle complex is expected to continue through the rest of the trading session as traders focus on lower feed costs and renewed support in beef values helping to stimulate longer-term buyer interest.
Limited trade activity is seen across the entire complex with prices mixed through the morning. Nearby contracts are hovering from 35 cents lower to 17 cents per cwt higher. This may continue to limit overall trade direction through the complex, even though the market remains extremely bearish. April futures are trading 32 cents lower at midday at $58.10 per cwt. This move lower has broken through long-term support and moved April contracts to contract lows through the morning. Additional uncertainty through the market is limiting significant buyer activity in all markets.
Cash prices are unreported due to confidentiality on the National Direct morning cash hog report.
Cash prices are unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog report.
Pork carcass values are slightly higher on the morning report with prices adding $0.28 per cwt at $65.10 per cwt with 142 loads traded. Lean hog index for 2/7 is $56.53, down $0.36, with a projected two-day index is $56.14, down $0.39.