DTN Midday Livestock Comments 11/02 12:08

DTN Midday Livestock Comments 11/02 12:08 Hog Futures Tumble Lower Monday Aggressive losses developed early Monday in nearby live cattle and lean hog futures. The lack of support in December lean hog trade is extending contract lows on concerns of weak holiday demand developing in the near future. By Rick Kment DTN Analyst GENERAL COMMENTS: Lean hog futures have continued to abruptly shock the livestock market with December contracts trading $1.75 per cwt lower, and extending contract lows in early November. This is creating even more concern surrounding weak pork demand going into the holiday season. Live cattle futures remain weak with December contracts, leading the market lower with triple-digit losses also due to weak buyer interest. Corn prices are lower in light trade. December corn futures are 6 cents per bushel lower. Stock markets are higher in light trade. The Dow Jones is 98 points higher while Nasdaq is up 50 points. LIVE CATTLE: December contracts are showing increased market pressure with triple-digit losses holding through the morning as these contracts are the front spot on the complex. These moves are helping to align the futures market more in line with cash market support, which may continue to create concerns about longer-term market direction heading into the holiday season. Other nearby contracts are lightly traded with moderate losses, looking for additional direction from outside markets. Cash cattle activity remains undeveloped with a few asking prices starting to be talked about at $142 in the South. Showlists are generally steady, although there is not expected to be very little change in most areas through the week. The overall tone of the market may not see much direction until midweek or later as packers may not start to float bids until that point even though there may not be a lot of cattle available on hand at this point. Packers may need to rely on quick turnaround times through the week once deals are made. Beef cut-outs at midday are higher, $0.79 higher (select) and up $0.84 per cwt (choice) with light movement of 53 total loads reported (21 loads of choice cuts, 13 loads of select cuts, no loads of trimmings, 19 loads of ground beef). FEEDER CATTLE: January through May feeder cattle futures are holding triple-digit losses following the inability for early week buyer support to be seen in either the live cattle or the grain complex Monday morning. Trade volume remains moderate at this point, but the complex seems to be focusing on concerns of buyer interest through first-quarter buying in early 2016 live cattle contracts. LEAN HOGS: Lean hog futures started out firm to higher in early trade, but have eroded through the morning with front-month December contracts leading the move lower. Triple-digit losses are holding in December contracts as contract lows are being extended below $57.50 per cwt, as losses are expanded beyond $1.75 per cwt at midday. There is very little support in the market at this point as the cash and futures market seems to be leap frogging each other lower. The inability to hold prices at $60 per cwt at the end of last week has created additional widespread market pressure, but fortunately most of the pressure has been reserved for nearby contracts, as deferred contracts willing to watch from afar. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.59 per cwt to $59.36 per cwt with the range from $56.00 to $61.25 per cwt on 3,204 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 172 loads selling with prices up $1.15 per cwt. Lean hog index for 10/29 is at $71.18 down 0.95, with a projected two-day index of $69.98, down 1.20. Rick Kment can be reached at rick.kment@dtn.com (BAS) Copyright 2015 DTN/The Progressive Farmer. All rights reserved.