DTN Midday Livestock Comments 10/27 12:02

DTN Midday Livestock Comments 10/27 12:02 November Feeder Cattle Futures Plunging Lower Tuesday Losses once again quickly developed through the cattle complex Tuesday morning with live cattle and feeder cattle posting strong triple-digit pressure as traders quickly ratchet prices lower in an attempt to try to outpace selling pressure. Buyer support has been hard to find through the morning as the focus is being placed on uncertain short-term beef demand. By Rick Kment DTN Analyst GENERAL COMMENTS: Cattle markets have set a weaker tone for the entire livestock market with strong triple-digit losses seen in both live cattle and feeder cattle markets. This is creating additional concerns that additional pressure may create widespread pressure through midweek and could damage fundamental support which was built through the entire month of October. Hog futures continue to turn sharply lower with December contracts leading the way. Corn prices are lower in light trade. December corn futures are 5 cents per bushel higher. Stock markets are lower in light trade. The Dow Jones is 27 points lower while Nasdaq is down 7 points. LIVE CATTLE: Triple-digit losses continue to hold in live cattle futures with October live cattle futures leading the market lower. Unlike the feeder cattle complex, where nearby contracts are holding a strong premium to the deferred contracts. October live cattle futures continue to maintain a significant discount to the remaining nearby futures allowing traders to focus more on the ability to move additional beef to winter and spring markets. This could help to spark additional focus into firming beef demand beyond short-term activity and stabilizing the market. Cash cattle markets remain sluggish with bids and asking prices still generally undefined. A few cattle are priced at $142 or higher in the South, but the overall tone of the market remains up in the air and focused on the direction of the futures market as well as shifts in boxed beef values through the week. Beef cut-outs at midday are higher, $0.29 higher (select) and up $1.30 per cwt (choice) with light movement of 63 total loads reported (34 loads of choice cuts, 18 loads of select cuts, no loads of trimmings, 12 loads of ground beef). FEEDER CATTLE: Widespread pressure continues to hold through feeder cattle futures as traders remain focused on weakness in the live cattle market and concern that additional pressure will develop once October futures go off the board at the end of the month. October futures have remained limited to moderate losses, hovering at $193 per cwt, while November futures are seen nearly $3 per cwt through most of the morning, nearly $4 to $5 per cwt lower than the October contract at several times through the morning trade. This could add additional concern through the entire market over the coming days. LEAN HOGS: Losses have expended in nearby lean hog futures as traders continue to focus on aggressive pressure in all cattle futures as well as continued pressure in cash hog and pork values. The continued weakness in the market is most evident in the December lean hog futures complex which is holding a $1.10 per cwt loss and leading the entire market lower, trading under $62 per cwt. The lack of underlying support may not bring continued pressure through the rest of the session, but it is not likely to draw buyers back into the market either. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.04 per cwt to $65.71 per cwt with the range from $61.00 to $67.00 per cwt on 1,590 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price fell $0.41 per cwt to $66.32 per cwt with the range from $61.00 to $67.00 per cwt on 302 head reported sold. The National Pork Plant Report reported 212 loads selling with prices down $0.29 per cwt. Lean hog index for 10/23 is at $73.63 down 0.49, with a projected two-day index of $73.29, down 0.34. Rick Kment can be reached at rick.kment@dtn.com (BAS) Copyright 2015 DTN/The Progressive Farmer. All rights reserved.