DTN Midday Livestock Comments 01/19 11:57

DTN Midday Livestock Comments 01/19 11:57 Strong Gains Hold in Cattle Trade Strong early gains are holding through the cattle markets as traders are focusing on regaining ground from last week's sharp losses. Mixed trade is seen through the lean hog futures contracts, limiting overall market direction once again. By Rick Kment DTN Analyst GENERAL COMMENTS: Cattle futures remain firmly higher following sharp early gains. The wide price shifts seen through the last two trading sessions are expected to create additional market shifts through the next couple of weeks. Corn prices are higher in light trade. March corn futures are 5 cents higher. Stock markets are mixed in light trade. The Dow Jones is 27 points higher while Nasdaq is down 9 points. LIVE CATTLE: Live cattle futures have bounced sharply higher early Tuesday morning based more on the reaction from limit losses late last week than any other factor. This initial buyer support has eroded slightly as the morning progressed, leaving trade $1 to $1.50 per cwt at midday. The firm support may not be enough to draw active volume back into the market, but it could help to draw some increased market stability into the complex through the rest of the week. Cash cattle activity remains inactive with bids and asking prices still undefined early in the week. It is not expected that trade will develop until midweek or later. There could be some bids developing through the end of the week, but it would not be surprising to wait until Wednesday until packers start to distribute prices. Beef cut-outs at midday are lower, $0.45 lower (select) and down $0.68 per cwt (choice) with light movement of 54 total loads reported (36 loads of choice cuts, 11 loads of select cuts, no loads of trimmings, 7 loads of ground beef). FEEDER CATTLE: Feeder cattle futures are holding strong triple digit gains at midday, although current support is well below morning highs as buyer interest has slowly backed away from the market through the end of the morning. Nearby contracts are holding gains of $1 to $2 per cwt as traders remain focused on the ability to draw interest back into the complex. If prices move into negative territory before market settlement, longer term pressure could quickly develop through the entire complex. LEAN HOGS: Nearby lean hog futures are gaining moderate to strong support early in the week with February futures posting 90 cent gains holding above $62 per cwt. The lack of support in deferred futures is keeping the brakes applies on long-term buyer support, which seems to be creating longer-term stability through the complex. Cash prices are higher on the National Direct morning cash hog report. The weighted average price added $1.70 per cwt to $53.14 per cwt with the range from $48.00 to $55.00 per cwt on 6,183 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 239 loads selling with prices up $1.13 per cwt. Lean hog index for 1/15 is at $55.83 up 0.41, with a projected two-day index of $56.25, up 0.42. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.