Live and feeder cattle futures are lower at midday Wednesday. Lean hog futures are higher on the heels of Tuesday’s limit-up move.
The cattle complex started lower Wednesday and remains under pressure with less volatility than we have seen over the past days. So far it is an inside trading day and may remain that way unless something significant takes place in cash trade. That is not likely as business will likely wait until later in the week as usual. There is follow-through buying in hogs, but traders are not using expanded trading limits to get things done. Underlying fundamentals do not suggest price will trend higher at the present time. Corn futures are lower as traders look ahead to the World Agricultural Supply and Demand report Thursday. September corn is 1 1/4 cents lower. The DOW is up 90 points while the NASDAQ is up 50 points.
Selling pressure developed at the opening bell and has been maintained through the morning. Cash has not traded and provides no direction one way or the other. Volatility has been limited, but some spillover strength could come from a second day of strong hog futures. August is trading at $1.0750 and we need to look out to December to see anything over $100.00. Technically, the market is in an uptrend.
Cash trading is nonexistent with bids and offers at a distance. Boxed beef cutouts are lower with Choice cuts down $0.80 per cwt and Select down $1.18 per cwt. There has been good movement of 112 loads reported with 60 loads of choice cuts, 20 loads of select cuts, 13 loads of trimmings, and 18 loads of ground beef.
Futures show minor losses posting a rather close trading day. Not much strength is coming from live cattle with that market pausing after a strong day Tuesday. The trend is solidly higher and should see further gains as long as live cattle remain supported.
Strong follow-through buying on the heels of Tuesday’s strong limit-up move. The market has extend trading limits Wednesday and so far August is taking advantage of that with price up $3.25 and the highest price month.
Cash prices are higher in the National Direct morning report, the weighted average price is $0.94 higher at $67.90 with a range of $56.00 to $70.00.
The National Pork Plant report posted 166 loads selling, 152 loads of cuts and 14 loads of trim/process pork. The carcass vales declined $1.24 per cwt to $72.53 per cwt. The lean hog index for 7/08 is $71.25, down $0.67 with a projected 2-day index of $70.77, down $0.49.