DTN Midday Livestock Comments 06/27 12:08

DTN Midday Livestock Comments 06/27 12:08 Strong Cattle Market Gains Hold Monday Cattle futures are rebounding through the morning Monday with triple-digit gains able to hold firm. The pressure that is redeveloping in the lean hog market is pointing to additional follow-through softness likely to develop through the week. By Rick Kment DTN Analyst GENERAL COMMENTS: Cattle futures are holding strong triple-digit gains in nearby contracts as the focus through the market continues to be driven on short-covering activity after the aggressive Friday losses. Trade activity is expected to remain sluggish through the rest of the complex, although the tone of the market is likely to remain firm. Corn prices are higher. July corn futures are 4 cents higher. Stock markets are lower in light trade. The Dow Jones is 248 points lower while Nasdaq is down 99 points. LIVE CATTLE: Live cattle futures are holding strong triple-digit gains based on short covering activity following Friday's losses. The firm support in the grain market is helping to draw buyers back to the complex. Cash cattle markets remain quiet with show lists coming in smaller than last week. The focus on the long holiday weekend, and lower plant output due to the holiday next week is expected to limit overall trade activity through the end of the week. The fact that this week ends both the month of June and second quarter may create additional lack of support early in the week when it comes to cash markets. Beef cut-outs at midday are mixed $0.21 higher (select) and down $1.53 per cwt (choice) with light movement of 82 total loads reported (40 loads of choice cuts, 12 loads of select cuts, 6 loads of trimmings, 23 loads of ground beef). FEEDER CATTLE: Firm buyer support continues to hold early Monday with gains stepping into the complex following the sharp losses late last week. Although some support has slowed in deferred contracts, nearby futures continue to hold triple-digit gains. The focus on short covering has driven the market so far through the morning, but it is uncertain if additional buyer support is available and willing to step into the market through the end of the session. LEAN HOGS: Moderate to strong pressure is seen through the lean hog futures complex Monday morning. The fact that prices continue to push lower is no significant surprise given the lack of buyer support willing to step into the recent market as it tumbles lower. But there are questions about just how much follow through pressure will develop. This could limit long term support over the future as fall contracts are holding triple digit losses. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.90 per cwt to $80.10 per cwt with the range from $74.00 to $81.50 per cwt on 3,411 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price fell $1.45 per cwt to $80.57 per cwt with the range from $79.75 to $81.50 per cwt on 155 head reported sold. The National Pork Plant Report reported 182 loads selling with prices falling $0.57 per cwt. Lean hog index for 6/23 is at $84.41, up 0.39 with a projected two-day index of $84.61 up 0.20. Rick Kment can be reached at rick.kment@dtn.com (CZ) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.