DTN Midday Livestock Comments 05/20 12:09

DTN Midday Livestock Comments 05/20 12:09 Moderate Price Pressure Develops as Traders Take Protection on Friday Additional losses developed in most futures contracts on Friday, with traders looking for some sense of support. Even though there is very little fundamental or technical strength in the market, cattle traders are not giving up hope of finding something in the afternoon release of the Cattle on Feed report. By Rick Kment DTN Analyst GENERAL COMMENTS: Widespread market weakness continues through the complex with traders looking for price support. So far, volume is light to moderate, but many traders are unwilling to step back into the market. Corn prices are higher. May corn futures are 3 cents higher. Stock markets are higher in light trade. The Dow Jones is 110 points higher while Nasdaq is up 65 points. LIVE CATTLE: Pressure continues in nearby live cattle futures as traders react to weakness in cash cattle markets. Beef values have started to shift lower also, adding another degree of uncertainty to the already bearish market. This is creating pressure in all nearby contracts. Even though spring and summer 2017 contracts are able to hold minimal gains, the focus remains on the lack of underlying support in market fundamentals. Cash cattle trade is quiet with light bids developing in the North at $204 to $205. Business may be on hold until the release of the Cattle on Feed report at 2 p.m. CDT. It is likely most of the business in the South has been completed given the movement earlier in the week. Beef cut-outs at midday are lower, $2.30 lower (select) and down $2.06 per cwt (choice) with light movement of 53 total loads reported (29 loads of choice cuts, 12 loads of select cuts, 5 loads of trimmings, 8 loads of ground beef). FEEDER CATTLE: Feeder cattle futures have bounced higher and lower through the morning with early gains quickly giving way to moderate to strong losses. Traders are trying to position themselves in front of the afternoon Cattle on Feed report. The combination of general market weakness going into the report while most traders feel overall placement numbers will be reduced is leaving feeder cattle futures mixed at midday. The spot contract holds narrow gains while the rest of the complex is under pressure from a strong continued sell-off in the live cattle market. LEAN HOGS: Moderate to strong pressure continues in lean hog futures. Support is lacking in the cash markets and the price charts are unable to show any sign of a market slowdown. This is leading to additional liquidation through the complex. Pressure is strong, but contracts remain lightly traded this morning. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.74 per cwt to $74.30 per cwt with the range from $74.00 to $76.00 per cwt on 1,840 head reported sold. Cash prices are unreported due to confidentiality on the Iowa Minnesota Direct morning cash hog report. The National Pork Plant Report reported 125 loads selling with prices down $0.18 per cwt. Lean hog index for 5/18 is at $78.43, up 0.64 with a projected two-day index of $78.81, up 0.38. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.