DTN Midday Livestock Comments 11/09 12:20

DTN Midday Livestock Comments 11/09 12:20 Cattle Futures Crash at Midday Due to Technical Selling and Outside Markets The cattle complex is on the run as the new week begins with many live and feeder contracts hammered down the limit near midday. Lean hog futures are also struggling with triple-digit losses, pressured by spillover selling from cattle futures and a general lack of buying interest. By John Harrington DTN Analyst GENERAL COMMENTS: Activity in feedlot country today has been typically limited to packer assessment of the week's fed offering. New showlists appear to be mixed in size, smaller in Kansas, Nebraska, and Colorado, but a good deal larger in Texas. According to the midday report, the national hog base is $1.43 lower compared with the Prior Day settlement ($50.00-$53.00, weighted average $55.76). Corn futures are generally a nickel lower at midday thanks in part to pronounced weakness in the wheat trade and ideas that tomorrow's production report will once again raise the size of total production. U.S. equities are sharply lower near the top of the noon hour as investors weighed a possible Fed rate hike in December. The Dow is 202 points lower as of this writing with the Nasdaq down by 63. LIVE CATTLE: For the first hour of trade, live contracts looked ready to stabilize with early pricing no worse than mixed. But then all of a sudden the market broke hard with aggressive technical selling and long liquidation causing contracts to collapse near limit losses. Issues are mostly 300 points lower near midday with only a few months in the far deferred showing more moderate losses. Beef cut-outs are significantly higher at midday, up 0.54 (select, $207.79) to $1.23 (choice, $216.89) with light box movement (26 loads of choice cuts, 13 loads of select cuts, 11 loads of trimmings, 20 loads of coarse grinds). FEEDER CATTLE: Feeders are stuck in the same hot water as their live counterparts. The majority of contracts are now down the 450-point limit. Needless to day, ugly feedlot losses and sinking fed prospects for 2016 are encouraging would be commercial buyers to run for cover. On an estimated run of 11,000 head (up from 8,630 last week and 7,719 in 2014), Oklahoma City has sold steer and heifer calves $5-15 lower in the early rounds. LEAN HOGS: Triple-digit losses dominate the lean trade at midday with most contracts off 102 to 192. Perhaps if the cash market would start to show signs of greater stability, bears would stop augmenting the board's discount. Yet for the time being it would appear that futures want to keep anticipating tougher and tougher fundamentals. The carcass value is sharply higher at midday with the belly primal quoted $10.54 higher. Pork cut-out: $77.15, up $1.87. CME cash lean 11/05: 64.61, off 1.81 (DTN Projected lean index for 11/06: 62.55, off 2.06). John Harrington can be reached at feelofthemarket@yahoo.com Follow John Harrington on Twitter @feelofthemarket (BAS) Copyright 2015 DTN/The Progressive Farmer. All rights reserved.