DTN Midday Livestock Comments          11/14 12:09

   Moderate Losses Hold in Cattle Futures 

   Pressure is seen in most cattle trade early Wednesday as traders try to 
adjust to the sharp market shifts seen earlier in the week. Trade volume is 
expected to remain light to moderate through the rest of the complex, allowing 
for limited direction over the next couple of days.

By Rick Kment
DTN Analyst

General Comments

   Moderate pressure has developed through livestock futures as cattle markets 
have shifted lower late morning. The move is being led by live cattle futures, 
focusing on the pullback in feeder cattle trade. Corn markets are lower in 
light to moderate trade. December corn futures are 1/4 cent lower. Stock 
markets are lower in light trade. The Dow Jones is 163 points lower while 
Nasdaq is down 50 points.

   LIVE CATTLE:

   Firm pressure in feeder cattle futures is adding to the overall lack of 
support in live cattle markets. Front month December futures are holding an 82 
cent per cwt loss, while the rest of the complex remains contained in a 
narrowly mixed range. Prices continue to test short term lows, in several 
nearby contracts, but the wide sideways trend seen in long term activity is 
expected to continue and allow prices to shift higher and lower within a 
moderate pattern over the next several weeks. Cash cattle interest is slowly 
trickling into the market with a few dressed bids in the North from $175 to 
$176 per cwt. Asking prices remain extremely hard to pin down with not enough 
seen to establish a sense of feeders interests. It is likely that both sides 
will become more vocal through the end of the day, although at this point it is 
likely that trade will not develop until late in the week. Boxed Beef cut-outs 
at midday are lower, $0.63 lower (select) and down $0.48 per cwt (choice) with 
moderate movement of 88 total loads reported (56 loads of choice cuts, 16 loads 
of select cuts, no loads of trimmings, 15 loads of ground beef).

   FEEDER CATTLE:

   Moderate losses are seen at midday following back and forth market shifts 
through the morning. Nearby contracts are showing a 2 cent loss in the lightly 
traded November contract, although prices through the rest of the complex are 
trading 25 to 70 cents lower. Most of the morning pressure has little to do 
with the direction of markets or fundamental shifts, but more focused on market 
corrections following the aggressive and potentially overstated gains seen in 
late trade Tuesday. Light activity is expected to be seen through the rest of 
the session, with limited activity seen across the complex.

   LEAN HOGS:

   Limited activity is seen through the entire lean hog futures complex with 
nearby gains seen 10 to 45 cents per cwt higher. The overall lack of aggressive 
follow through support is not surprised given the back and forth market shifts 
through the entire week. Deferred contracts are holding light to moderate 
losses with limited additional direction seen across the complex. December 
through April contracts, which are posting gains, are the same market contracts 
that developed late day support Tuesday, indicating follow through commercial 
support in nearby contracts as traders focus on the ability to hold cash 
markets higher in morning reports. Cash prices are higher on the National 
Direct morning cash hog report. The weighted average price is $0.31 higher at 
$51.86 per cwt with the range from $46.00 to $52.44 on 5,771 head reported 
sold. Cash prices are higher on the Iowa/Minnesota Direct morning cash hog 
report. The weighted average price is $1.56 higher at $51.70 per cwt with the 
range from $48.00 to $52.00 on 1,354 head reported sold. The National Pork 
Plant Report posted 223 loads selling on the morning report. Pork carcass 
values fell $1.00 per cwt at $69.69 per cwt. Lean hog index for 11/12 is 
$61.20, down 0.67, with a projected two-day index of $60.47, down 0.73. 

   Rick Kment can be reached at rick.kment@dtn.com 


(CZ)

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