DTN Midday Livestock Comments 09/16 12:07

DTN Midday Livestock Comments 09/16 12:07 October Live Cattle Futures Post Daily Limit Losses Market softness has continued to develop through all livestock futures through the morning. Cattle futures are leading the market lower, with nearby and deferred contracts holding aggressive losses. Lean hog futures are shifting lower as the cattle market pressure is too much for previous gains to overcome during midweek trade. By Rick Kment DTN Analyst GENERAL COMMENTS: Cattle futures have turned sharply lower with front-month live cattle contracts limit lower after a $3 per cwt loss during the morning. Feeder cattle futures are trading $3 to $4 per cwt lower with prices quickly falling through support levels, creating some additional downside potential in the complex. Corn prices are lower in light trade. December corn futures are 5 cents per bushel lower. Stock markets are higher in light trade. The Dow Jones is 106 points higher while Nasdaq is up 21 points. LIVE CATTLE: Strong losses have redeveloped through live cattle futures as initial stability following a strong move lower in feeder cattle futures. The break through short term support levels of $140 per cwt in October contracts led to aggressive follow-through pressure. This has pushed front month futures limit lower at midday, creating some uncertainty about when additional support can step back into the market. Cash cattle markets remain quiet with a few token bids at $215 seen in the North. Given the aggressive slide in futures trade, no one is going to risk putting their neck out too far. The lack of stability in futures markets will likely push trade until Thursday, or more likely Friday. Asking prices are still not well defined, but expected to be around $143 to $144 in the South and $223 and higher in the North. It may be late in the week before active trade develops. Beef cut-outs at midday are higher, $1.12 higher (select) and up $0.25 per cwt (choice) with active movement of 94 total loads reported (41 loads of choice cuts, 22 loads of select cuts, 17 loads of trimmings, 15 loads of ground beef). FEEDER CATTLE: Losses in the feeder cattle futures complex are hovering around the $4 per cwt level as prices broke through support levels early in the session which allowed for a landslide of additional liquidation to sweep through the market. Traders are looking for additional market stability, but little is to be found anywhere in the cattle complex. September futures have fallen below the $195 per cwt level in morning pressure with all other contracts well below $190 per cwt levels. LEAN HOGS: Lean hog futures trade got caught up in the firestorm seen through the cattle markets Wednesday, as the aggressive market support seen early in the week was unable to hold up given outside market pressure. All contracts are holding losses of $1 to $2 per cwt as the focus is being placed on all livestock and meat markets, and not the individual moves in the hog complex. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.51 per cwt to $66.22 per cwt with the range from $58.00 to $69.00 per cwt on 4,515 head reported sold. Cash prices are unreported due to confidentiality on the Iowa Minnesota Direct morning cash hog report. The National Pork Plant Report reported 315 loads selling with prices slipping $0.07 per cwt. Lean hog index for 9/14 is at $71.44 down 0.50, with a projected two-day index of $70.98, down 0.46. Rick Kment can be reached at rick.kment@dtn.com (BAS) Copyright 2015 DTN/The Progressive Farmer. All rights reserved.