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DTN Midday Livestock Comments          06/23 11:54

   Mixed Trade Develops Through Light Friday Trade 

   Sluggish activity Friday has kept markets moving in a choppy pattern with 
very little sense of long term direction able to be seen. June cattle on feed 
reports will be released Friday afternoon, leading to additional market 
direction in the cattle market.  

By Rick Kment
DTN Analyst


   Trade volume remains sluggish late Friday morning with light losses 
developing in live cattle futures following mixed beef value moves. The overall 
lack of support in the complex and pullback from early gains continues to add 
to the sharp losses in cash trade earlier in the week. Strong triple-digit 
pressure is quickly developing in lean hog futures, created positioning 
opportunities through the complex. Corn prices are lower in light trade. July 
corn futures are 2 cents lower. Stock markets are higher in light trade. The 
Dow Jones is 20 points higher while Nasdaq is up 26 points.


   Early gains in cattle markets, and live market futures have faded quickly as 
trades have focused on follow through selling pressure which has developed 
through the week. The sharp losses in cash prices and developing pressure in 
beef values is putting even more pressure on live cattle trade. Uncertainty 
surrounding overall cattle numbers in feedlots on the cattle on feed report is 
also adding to the market volatility even though volume remains light. Cash 
cattle trade appears to be done for the week with no bids developing following 
sharply lower cash business seen over the last two days. Beef cut-outs at 
midday are mixed, $0.09 higher (select) and down $3.38 per cwt (choice) with 
light movement of 42 total loads reported (23 loads of choice cuts, 10 loads of 
select cuts, 4 loads of trimmings, 5 loads of ground beef). 


   Light gains have continued to hold in feeder cattle futures through late 
morning despite the building pressure in live cattle markets. Trade volume is 
sluggish across the market as trades seem to be willing to call it a week in 
many aspects of the market. There is likely to be some additional market shifts 
seen just before closing bell as the aggressive placement expectations likely 
to develop in the cattle on feed report which will be released at 2 p.m. 
central time may spark additional market movement early next week across the 


   Triple-digit losses are seen in all nearby lean hog futures except 
front-month July contracts Friday morning. The aggressive late-week pressure in 
the complex is focused on end-of-week position taking despite fundamental 
support and strong cash and pork value gains. Light trade volume is seen 
through the morning and expected to hold through the rest of the day with 
traders unwilling to step back into the market in order to shift the market 
direction at this point. Most contracts are holding losses of $1.30 to $1.80 
per cwt heading into the weekend break. Cash prices are lower on the National 
Direct morning cash hog report. The weighted average price fell $0.75 at $85.39 
per cwt with the range from $85.00 to $87.00 on 3,920 head reported sold. Cash 
prices are lower on the Iowa/Minnesota Direct morning cash hog report. The 
weighted average price fell $0.97 at $85.72 per cwt with the range from $85.00 
to $87.00 on 1,955 head reported sold. The National Pork Plant Report reported 
87 loads selling with prices adding $1.42 per cwt. Lean hog index for 6/21 is 
at $89.30 up $1.27 with a projected two-day index of $90.17 up $0.87. 

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


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