DTN Midday Livestock Comments 03/11 12:00

DTN Midday Livestock Comments 03/11 12:00 Cattle futures Hold Gains, But Pull Back From Session Highs Aggressive morning-buying activity has developed through the complex with traders focusing on tighter supplies and short-bought packer situations at the end of the week. This has sparked a strong rally in cash cattle trade with prices in the North seen at $220 per cwt which is $7 per cwt higher than last week. Cattle futures have pulled back from session highs, but continue to hold moderate to strong gains based on firm market support. By Rick Kment DTN Analyst GENERAL COMMENTS: Extremely strong cattle market gains through the morning helped to spark higher cash cattle trade with deals inked in the North nearly $7 higher than last week's price levels. Futures prices at midday are mixed with traders pulling back from morning highs following softness in beef and pork values in morning cutout reports. Corn prices are higher. May corn futures are 1 cent higher. Stock markets are higher in light trade. The Dow Jones is 204 points higher while Nasdaq is up 64 points. LIVE CATTLE: Front-month live cattle futures are holding strong gains at midday despite pulling off of session highs as traders try to adjust positions at the end of the week. The lack of support in beef values on the morning cutout report is eroding the previous support, especially in deferred contracts, and causing some concern about just how much follow through gains may develop over the near future. Cash cattle has started to develop in the North through the morning with prices seen at $220 per cwt in Nebraska and Iowa. So far the volume of cattle sold has remained relatively light. But it may be enough to set the tone for the week. This is $7 per cwt higher than last week's average price. Bids in the North are at $220 per cwt with feeders now increasing asking prices to $225 in the North. Bids in the South are at $136 per cwt with asking prices at $140 and higher. Beef cut-outs at midday are mixed, $1.40 higher (select) and down $1.12 per cwt (choice) with light movement of 72 total loads reported (42 loads of choice cuts, 12 loads of select cuts, zero loads of trimmings, 17 loads of ground beef). FEEDER CATTLE: Firm gains continue to hold in feeder cattle futures based at midday based on aggressive support in cash cattle trade Friday morning. Even though the support across the market remains strong, prices have moved significantly well off of session highs as traders have pulled back at midday. The lack of support may not be continued through the end of the session as buyers could easily step back into the market over the next hour of trade, allowing for aggressive market support to redevelop at the end of the week. LEAN HOGS: Light trade continues to be seen across the lean hog futures market despite the aggressive buyer interest that has flooded into the cattle market Friday. Hog futures remain mixed to mostly lower as buyers have been unable to find a foothold through the morning with April lean hog futures carrying the majority of nearby selling pressure as prices hold a 35 cent loss. The pressure in front month contracts is expected to be associated more with late-week position taking following the recent market rally rather than any other factor, while June futures continue to hold narrow gains. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.91 per cwt to $61.81 per cwt with the range from $55.00 to $63.00 per cwt on 1,872 head reported sold. Cash prices unreported due to confidentiality on the Iowa Minnesota Direct morning cash hog report. The National Pork Plant Report reported 148 loads selling with prices down $1.52 per cwt. Lean hog index for 3/9 is at $66.56 up 0.08, with a projected two-day index of $66.66, up 0.10. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.