Moderate price support is moving back into lean hog futures Wednesday morning with summer contracts leading the complex higher. This may add some additional momentum to the recent price shift, which is sparking active market moves.
Moderate pressure is holding in cattle trade with prices focusing on the desire by live cattle traders to adjust positions following early week gains. The air seems to thin significantly in April contracts above $128 per cwt, allowing traders to pull back from these levels temporarily. Hog futures are showing limited moves with firm gains seen in summer contracts as traders build on the recent market shift higher.
Corn markets are lower in light trade. March corn futures are 3/4 cent lower. Stock markets are higher in light trade. Dow Jones is 76 points higher with Nasdaq up 9 points.
Moderate pressure has moved through live cattle trade with 40 to 60 cent losses seen through the complex. At this point, the pullback in prices are not associated with a developing market sell-off, and more focused on position adjustments after hitting new contract highs Monday. This softness is likely to continue through the session, although prices would need to move another 50 cents lower in order to reach any sense of short term support level, and over $1 per cwt lower before significant market stops are seen.
Cash cattle trade is still undeveloped, although a few bids have redeveloped with firming prices from Tuesday. Live bids in Texas are seen at $122 per cwt, while dressed bids of $200 per cwt are developing in Nebraska. Asking prices are holding at $126 and higher live and $203 to $205 dressed. Active trade is expected to hold out until Thursday or Friday.
Boxed Beef cut-outs at midday are lower, $0.96 lower (select) and down $0.41 per cwt (choice) with light movement of 67 total loads reported (36 loads of choice cuts, 9 loads of select cuts, 14 loads of trimmings, 8 loads of ground beef).
Feeder cattle trade remains sluggish Wednesday morning with very limited support developing through the entire cattle complex. Nearby futures are holding losses of 50 to 70 cents per cwt at midday as the focus on renewed grain buying activity through the week is adding concerns of higher production costs. This is likely to add pressure to cash and futures feeder cattle trade through the next week or two despite the firm support in the live cattle complex.
Even though the brutal weather over the last couple of weeks is developing reports of cattle losses, at this point, this has not and is not expected to affect the overall market, although local markets may see more impact.
Limited trade is seen early Wednesday morning with very sluggish market direction developing across the complex. This is expected to keep prices mixed in a narrow to moderate range. April futures seem to be showing the most uncertainty with prices falling just 7 cents per cwt following strong triple digit gains. Summer contracts are holding firm gains of 50 to 60 cents per cwt at midday, allowing for increased focus on renewed commercial and investment buyer activity through the hog complex.
Cash prices are unavailable at this time on the National Direct morning cash hog report.
Cash prices are unavailable at this time on the Iowa/Minnesota Direct morning cash hog report.
Pork carcass values slipped on the morning report with prices falling $0.29 per cwt at $64.93 per cwt with 216 loads traded. Lean hog index for 2/11 is $55.91, down $0.23, with a projected two-day index is unavailable at this time.