DTN Midday Livestock Comments 01/08 12:09

DTN Midday Livestock Comments 01/08 12:09 Feeder Cattle Futures Slide $2 Lower Friday Morning Early gains in live cattle and feeder cattle futures have quickly eroded Friday. This has quickly turned the tone of the market lower and sparked concern of additional market softness through the rest of the week. By Rick Kment DTN Analyst GENERAL COMMENTS: Feeder cattle futures have turned sharply lower Friday morning despite showing moderate to strong buyer support early in the session. The inability to hold gains in both live cattle and feeder cattle trade continues to create longer term market support across the complex. Corn prices are higher in light trade. March corn futures are 4 cents higher. Stock markets are higher in light trade. The Dow Jones is 52 points higher while Nasdaq is up 16 points. LIVE CATTLE: Early triple-digit gains have been replaced with mixed trading ranges at midday with nearby support able to hang on. There will continue to be some underlying support developing based on the strong boxed beef prices still flowing into the market from previous gains in cash cattle prices. But the bearish moves in feeder cattle markets and limit losses Thursday in live cattle markets are putting increased pressure on deferred live cattle contracts in late day trade. Cash cattle trade posted light to moderate activity Thursday afternoon with price steady to $2 per cwt lower. It is likely that the trading range has already been set with bids redeveloping in the same price range Friday morning. Additional trade activity is expected to be seen through the rest of the day. Beef cut-outs at midday are higher, $3.21 higher (select) and up $2.56 per cwt (choice) with active movement of 123 total loads reported (71 loads of choice cuts, 20 loads of select cuts, 9 loads of trimmings, 22 loads of ground beef). FEEDER CATTLE: Aggressive losses have redeveloped in feeder cattle futures Friday morning with traders focusing on weaker cash cattle trade and the inability for outside markets to rebound significantly at the end of the week. There may be some additional interest stepping into the market through the last couple hours of trade, but the weaker tone of the market has opened the door for some additional market losses at the end of the week as traders focus on the recent market support through the month of December. LEAN HOGS: Firm buyer support continues to hold through the lean hog complex with February contracts holding a $1.05 per gain at midday. Moderate gains are holding through nearby contracts with traders looking for market stability at the end of the week. The potential to draw firm support back into complex through the end of January is likely to support commercial buyer support through the rest of the complex. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.30 per cwt to $48.99 per cwt with the range from $43.50 to $51.25 per cwt on 2,294 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price fell $0.50 per cwt to $50.27 per cwt with the range from $43.50 to $51.25 per cwt on 709 head reported sold. The National Pork Plant Report reported 236 loads selling with prices up $0.99 per cwt. Lean hog index for 1/6 is at $53.50 up 0.21, with a projected two-day index of $53.73, up 0.23. Rick Kment can be reached at rick.kment@dtn.com (BAS) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.