DTN Midday Livestock Comments 05/10 12:02

DTN Midday Livestock Comments 05/10 12:02 Pressure Develops in Feeder Cattle Based on Surging Grain Markets Aggressive gains in the grain markets have led to a pullback in the feeder cattle futures at midday Tuesday. This is creating uncertainty through the complex, although trade volumes through the entire complex remain light. By Rick Kment DTN Analyst GENERAL COMMENTS: Strong pressure is seen in feeder cattle markets following the push higher in corn and soybean markets following the USDA reports. Despite this move, the remainder of the livestock complex remains lightly traded in a mixed market shift. Corn prices are higher. May corn futures are 9 cents higher. Stock markets are higher in light trade. The Dow Jones is 191 points higher while Nasdaq is up 47 points. LIVE CATTLE: Live cattle futures are mixed in a narrow price range as traders continue to focus on very little market direction in the livestock complex itself, instead focusing on the aggressive moves in the grain market following the USDA crop report. This continues to drive additional prices shifts through the morning and will likely leave prices mixed through the rest of the session. Cash cattle markets are still quiet although little activity has developed with bids still unseen. Active trade is not likely to develop until the second half of the week. Beef cut-outs at midday are higher, $5.01 higher (select) and up $3.00 per cwt (choice) with light movement of 63 total loads reported (33 loads of choice cuts, 13 loads of select cuts, 1 load of trimmings, 16 loads of ground beef). FEEDER CATTLE: Early mixed trade has eroded at midday as the strong support in grain prices has caused traders to take a back step to the complex following the USDA report Tuesday morning. May feeder cattle are leading the market lower with a 95 cent per cwt loss as traders are replacing early buyer support and countering the triple-digit gains, which developed on Monday. The support seen early in the week may continue to unwind given the renewed support in the grain market. LEAN HOGS: Firm gains have held through the lean hog futures complex through the morning with nearby contracts holding 40 to 60 cent gains as moderate short covering has quickly stepping into the complex Tuesday following the triple digit losses which developed during early week trade. Overall volume has remained extremely light, as traders remained extremely concerned about the limited amount of trade activity expected to be seen through the rest of the week and potential cash market support later in the week. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.09 per cwt to $71.19 per cwt with the range from $65.00 to $74.00 per cwt on 4,906 head reported sold. Cash prices are higher on the Iowa Minnesota Direct morning cash hog report. The weighted average price added $0.71 per cwt to $73.60 per cwt with the range from $67.00 to $74.00 per cwt on 1,851 head reported sold. The National Pork Plant Report reported 328 loads selling with prices up $0.50 per cwt. Lean hog index for 5/6 is at $74.74, up 0.41 with a projected two-day index of $75.12, up 0.38. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.