DTN Midday Livestock Comments 02/24 11:54

DTN Midday Livestock Comments 02/24 11:54 Strong Gains Redevelop Midday Wednesday Early losses Wednesday have been replaced by moderate to strong gains in both cattle and hog futures. The aggressive triple-digit rally that quickly surged through nearby feeder cattle contracts helped to spark renewed buyer support in live cattle markets. Lean hog futures quickly regained momentum, pushing April futures sharply higher as initial seller pressure quickly ran out of gas. By Rick Kment DTN Analyst GENERAL COMMENTS: Strong buyer support has developed through the entire livestock complex Wednesday morning as triple-digit gains are seen in both lean hog and feeder cattle contracts. Underlying buyer support remains in question as traders look for increased support despite the lack of outside market gains. Corn prices are lower. March corn futures are 0.5 cents lower. Stock markets are lower in light trade. The Dow Jones is 155 points lower while Nasdaq is down 35 points. LIVE CATTLE: Live cattle futures have replaced early losses with moderate to strong market gains in all but front month February contracts. February contracts are unchanged at midday holding at $137 per cwt, although trade remains extremely light. April futures are leading the rally higher, posting an 85-cent gain. A close at this level in April contracts would break through short-term resistance levels, helping to spark additional market support. Cash cattle markets remain quiet with bids generally quiet, although a few bids are seen in Texas at $133 per cwt. Active trade is likely to be delayed until Thursday or Friday at this point. Asking prices are at $138 to $140 in the South and $215 and higher in the North. Beef cut-outs at midday are higher, $1.15 higher (select) and up $2.27 per cwt (choice) with light movement of 87 total loads reported (46 loads of choice cuts, 18 loads of select cuts, no loads of trimmings, 23 loads of ground beef). FEEDER CATTLE: Feeder cattle futures have rallied through the morning with renewed support quickly developing in the last half of the morning as traders stepping up to the plate following the gains seen Tuesday. April futures are holding $2 per cwt gains with the focus on increased market support, as the rest of the complex continues to maintain triple-digit gains based on supply tightness of feedlot-ready cattle through the spring and summer months as prices are $1.50 to $1.80 per cwt higher. LEAN HOGS: Lean hog futures held narrow losses through most of the morning Wednesday, but the lack of additional pressure able to develop in the market has allowed for increased market support to flood the complex. This pushed April lean hog futures above $70 per cwt with 90-cent gains at midday with deferred contracts slowly following the lead of nearby contract months. It is uncertain if there is enough underlying buyer support to sustain the strong midday market rally, due to lack of fundamental changes at midweek. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.28 per cwt to $61.61 per cwt with the range from $56.00 to $64.25 per cwt on 4,504 head reported sold. Cash prices were unreported due to confidentiality on the Iowa Minnesota Direct morning cash hog report. The National Pork Plant Report reported 254 loads selling with prices down $0.52 per cwt. Lean hog index for 2/19 is at $66.38 down 0.02, with a projected two-day index of $66.40, up 0.02. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.