DTN Midday Livestock Comments 02/12 12:08

DTN Midday Livestock Comments 02/12 12:08 Cattle Prices Slide Lower Friday Morning Traders are preparing for the three-day holiday weekend as Markets will remain closed Monday in observance of Presidents Day. Cattle futures have eroded lower through the morning despite early-morning buyer interest stepping into the market. This lack of support is creating concern about long-term support and focusing on the cash cattle market pressure seen over the past two weeks. By Rick Kment DTN Analyst GENERAL COMMENTS: Moderate pressure has developed Friday morning as early morning buyer support was unable to hold in both live cattle and feeder cattle markets. Lean hog futures are advancing support which started Thursday, based on stability in market fundamentals. Trade is expected to remain sluggish through the rest of the complex, which could limit market ranges at closing bell. Futures markets will remain closed Monday for President's Day, opening Tuesday. Corn prices are lower. March corn futures are 0.5 cent lower. Stock markets are higher in active trade. The Dow Jones is 245 points higher while Nasdaq is up 56 points. LIVE CATTLE: Follow-through pressure has developed through the entire live cattle futures market as early buyer support has quickly eroded Friday morning. The concern that the pressure in cash markets will continue to add pressure through the rest of the month despite the tightening beef supplies is creating additional underlying concerns in both nearby and deferred contracts. But live cattle futures remain technically stuck within a wide trading range, which may continue to keep prices wandering higher and lower through most of the spring. Cash cattle activity has developed through the morning with trade in the South likely to be essentially wrapped up for the week with trade seen at $133. This is $3 per cwt lower than last week and $1 lower than trade Wednesday. A few deals are starting to trickle in in the North at $206, which would be around $4 per cwt lower than last week, but mostly bids are still holding at this level. Trade may be done by the end of the day, given the defensiveness of futures markets and outside market pressure. Beef cut-outs at midday are lower, $1.00 lower (select) and down $0.35 per cwt (choice) with light movement of 61 total loads reported (40 loads of choice cuts, 12 loads of select cuts, no loads of trimmings, 10 loads of ground beef). Cash cattle markets remain quiet following moderate to active trade Thursday with prices $3 to $4 per cwt lower than last week. FEEDER CATTLE: The inability to hold early market support through feeder cattle contracts has sparked additional pressure in summer contracts, with May and August futures holding $1 per cwt losses. The lack of support in cash markets as well as lackluster interest in live cattle markets has limited additional buyer interest across the entire feeder cattle complex. LEAN HOGS: Light trade volume through the end of the week is limiting overall market direction through the entire lean hog complex. This is unable to bring additional seller pressure into nearby contracts, as February through July futures continue to hold moderate gains at midday, firming buyer interest at the end of the week. The strong pressure seen in outside markets earlier in the week has had the most impact on deferred contracts, pushing late fall and winger contracts moderately lower through the end of the trading session Friday. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.90 per cwt to $61.06 per cwt with the range from $52.00 to $62.50 per cwt on 3,463 head reported sold. Cash prices unreported due to confidentiality on the Iowa Minnesota Direct morning cash hog report. The National Pork Plant Report reported 135 loads selling with prices up $0.38 per cwt. Lean hog index for 2/10 is at $65.60 up 0.31, with a projected two-day index of $65.91, up 0.31. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.