DTN Midday Livestock Comments 05/12 12:00

DTN Midday Livestock Comments 05/12 12:00 Strong Gains Sweep Through Live Cattle Futures Front month live cattle futures have shown strong gains at midday Thursday with traders looking for additional support following aggressive cash cattle trade activity. Hog futures have remained sluggish with little interest developing given the inability to move in either direction through the morning. By Rick Kment DTN Analyst GENERAL COMMENTS: Firm support is developing in cash cattle markets Thursday, which is drawing additional trade back into the market at midday. Triple-digit support is seen in both live cattle and feeder cattle contracts. Lean hog futures are lightly traded with narrow gains holding through the morning. Corn prices are higher. May corn futures are 2 cents higher. Stock markets are lower in light trade. The Dow Jones is 36 points lower while Nasdaq is down 41 points. LIVE CATTLE: Strong midday support has flooded into front-month June futures at midday based on the development of strong cash market support Thursday morning. The aggressive moves through the beef values during the week as well as the need for packers to gain access to market ready cattle in front of the Memorial Day holiday have allowed for increased cash spending to surge. This quickly pushed June contracts $1.50 per cwt higher at midday, with front-month futures trading at $124 per cwt as traders remain focused on further support potentially developing before the end of the week. Cash cattle trade is starting to develop across the areas with prices as much as $5 per cwt higher than last week. But prices at this level are also being passed in some areas also. Bids are seen at $205 to $207 in the North on dressed basis. While sales in the North have been seen at the same price levels. Bids on a live basis in the South are seen at $130 to $132 with some sales at $132. Asking prices are above $132 to $134 in the South and $210 and higher in the North. Active trade is not likely to develop until Thursday or Friday. The support in the wholesale beef market should help to keep feeders from settling early in the week. Beef cut-outs at midday are higher, $2.26 higher (select) and up $0.18 per cwt (choice) with light movement of 72 total loads reported (33 loads of choice cuts, 17 loads of select cuts, 5 loads of trimmings, 18 loads of ground beef). FEEDER CATTLE: The development of higher cash cattle trade has quickly sparked additional interest in the feeder cattle market, pushing triple digit gains in several nearby and deferred contract months. August feeder cattle contracts are holding a $1.05-per-cwt gain with contracts above $150 per cwt once again as traders remain focused on the ability to draw additional interest back into the market late in the week. LEAN HOGS: Lean hog futures have remained lethargic through most of the morning after showing such early promise with an early jump higher in the market. The bounce in the futures prices helped to focus the attention of traders on the potential of additional market support in the cash and pork. Nearby contracts have been limited to gains of 10 to 30 cents as the focus through the market has been on maintaining midweek market support and long-term fundamental moves. Cash prices are higher on the National Direct morning cash hog report. The weighted average price added $0.07 per cwt to $72.88 per cwt with the range from $65.00 to $75.00 per cwt on 3,891 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price fell $0.23 per cwt to $74.00 per cwt with the range from $72.75 to $75.00 per cwt on 1,655 head reported sold. The National Pork Plant Report reported 156 loads selling with prices up $0.92 per cwt. Lean hog index for 5/10 is at $75.61, up 0.49 with a projected two-day index of $76.05, up 0.44. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.