DTN Midday Livestock Comments 04/15 12:04

DTN Midday Livestock Comments 04/15 12:04 Feeder Cattle Gains Lead Cattle Market Higher Strong buyer support in feeder cattle futures is driving spring and summer contracts to triple-digit gains. Cash cattle trade is starting to develop, helping to solidify buyer support in live cattle futures. By Rick Kment DTN Analyst GENERAL COMMENTS: Strong buyer support has surfaced in the cattle complex Friday morning as traders quickly step into deferred contracts based on firming demand expectations. Higher boxed beef values are also drawing support despite the light volume. Corn prices are higher. May corn futures are 5 cents higher. Stock markets are lower in light trade. The Dow Jones is 23 points lower while Nasdaq is down 3 points. LIVE CATTLE: Firm support is seen in all but front-month April contracts as traders focus on the renewed gains in boxed beef values and late-week support from the cash cattle trade. The momentum in late fall and winter live cattle contracts has become the main driver of the market, despite overall light volume on Friday morning. April contracts remain unchanged at midday Friday, but may continue to shift in a narrow range over the last two hours of the session as traders square positions following a volatile week. Cash cattle trade is developing in the North with prices at $215 per cwt. This is generally steady with last week's prices. Bids are improving at midday through the South at $134 per cwt, which is $1 higher than last week, but still being passed by feedlot managers at this point. The focus on steady to higher prices could help draw momentum into the market late Friday. Beef cut-outs at midday are higher, $1.47 higher (select) and up $0.60 per cwt (choice) with moderate movement of 69 total loads reported (40 loads of choice cuts, 14 loads of select cuts, no loads of trimmings, 15 loads of ground beef). FEEDER CATTLE: Triple-digit gains have developed in the May through September contracts with traders focusing on late-week support from cash cattle trade and the ability to spark additional gains based on beef values. This may bring additional buyer activity to the complex in the last couple hours of trade, although the range is not expected to move significantly from where it is currently. LEAN HOGS: Firm support is seen in the very lightly traded May contract which is now the front-month contract following April's expiration. But the rest of the complex is mixed in an extremely narrow trading range on lackluster interest. Little market direction is expected to be seen before the weekend break as traders are likely to take some time and reassess the overall situation before returning Monday. It is unlikely much will change over the next couple of days; in fact, very little change is expected over the next few weeks fundamentally. The complex is struggling to hold onto technical support. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.66 per cwt to $60.50 per cwt with the range from $54.00 to $63.00 per cwt on 2,553 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price fell $3.14 per cwt to $60.34 per cwt with the range from $54.00 to $63.00 per cwt on 131 head reported sold. The National Pork Plant Report reported 159 loads selling with prices up $0.06 per cwt. Lean hog index for 4/14 is at $66.71, up 0.01 with a projected two-day index of $66.67, down 0.04. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.