DTN Midday Livestock Comments 05/21 12:06
Livestock Futures Move Higher
Strong gains developed in cattle futures Tuesday. Sharp corn losses quickly
refueled buyer interest in feeder cattle contracts.
By Rick Kment
Feeder cattle contracts led the charge Tuesday morning with strong gains in
the livestock futures. Oversold live cattle markets are following behind. July
corn futures are holding 14 cent losses. Stock markets are higher in light
trade. The Dow is 51 points higher while the Nasdaq is up 7 points.
Moderate to aggressive buyer support stepped back into the live cattle
market Tuesday morning. The combination of firmness in feeder cattle futures,
and strong losses in the corn market drew buyers back into an oversold live
cattle market. Cash cattle activity is undeveloped with no bids surfacing
through the morning. A few asking prices are at $127 in the South and $203 to
$205 in the North. It could easily be the second half of the week before trade
develops. Beef cutouts at midday are mixed, $0.21 per cwt lower (select) and up
$0.21 per cwt (choice) with light movement of 85 total loads reported (32 loads
of choice cuts, 30 loads of select cuts, 7 loads of trimmings, 16 loads of
Despite pressure in the front-month May contract the overall feeder cattle
complex gained significant buyer support through the morning Tuesday. The sharp
double-digit losses in the corn market are causing some feeder cattle traders
to step back to the plate.
Buyer support developed in deferred futures contracts Tuesday morning with
traders focusing on the potential longer-term demand support and tightening hog
supplies. Nearby futures started the morning mixed, but gained momentum based
on gains in wholesale pork values. Cash prices moved higher on the National
Daily Direct morning cash hog report. The weighted average price gained $0.09
per cwt to $89.97 per cwt with the range from $84.46 to $91.01 per cwt on 3,362
head reported sold. The National Pork Plant Report posted 160 loads at midday
with carcass values gaining $0.68 per cwt. Lean hog index for 5/17 is at $93.18
up 0.25 with a projected two-day index of $93.29 up 0.11.
Rick Kment can be reached at email@example.com
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