DTN Midday Livestock Comments 07/05 12:04

DTN Midday Livestock Comments 07/05 12:04 Cattle Futures Move Higher at Midday Early losses, which quickly developed across the cattle complex, were unable to hold as moderate to strong buyer support swept through the live cattle and feeder cattle markets through late morning. Lean hog futures remain under light pressure, but support from cattle trade is trying to limit losses in nearby contracts. By Rick Kment DTN Analyst GENERAL COMMENTS: Cattle futures have quickly bounced higher through the last half of the morning as moderate to strong gains are replacing the aggressive triple-digit losses seen early in the session. Lean hog futures remain under light to moderate pressure, although the support in the cattle market is likely to draw some thin support through the end of the session. Corn prices are lower. July corn futures are 11 cents lower. Stock markets are lower in light trade. The Dow Jones is 133 points lower while the Nasdaq is down 52 points. LIVE CATTLE: Wide price swings have developed across the live cattle futures Tuesday morning with active pressure seen early in the trading session being quickly eroded as nearby contracts are holding 60 to 75 cent gains through the end of the morning. Prices have swung more than $3 per cwt through the morning with markets aggressively moving in triple-digit ranges in either direction. The volatility in the market may create some additional uncertainty through the complex, although this may also limit trade volume in the second half of the trading session. Cash cattle activity remains quiet early Tuesday morning as packers and feedlot managers slowly enter the market. Show lists are reported to be generally larger, with some areas posting significant growth in offered numbers over last week. It is expected that trade volume last week is larger than earlier expected, but packers are likely to still need larger numbers in order to fill aggressive procurement schedules next week. Beef cut-outs at midday are higher $0.42 higher (select) and up $0.29 per cwt (choice) with light movement of 57 total loads reported (33 loads of choice cuts, 12 loads of select cuts, no loads of trimmings, 13 loads of ground beef). FEEDER CATTLE: Feeder cattle futures are showing evidence of a market reversal through the morning Tuesday. Although pressure quickly developed following the aggressive outside market losses, the inability to draw additional seller activity back into the market seems to be focusing on the uncertainty in the market as nearby feeder cattle futures are holding $1 to $1.50 per cwt gains at midday. Given the wide price swing in the complex there is uncertainty about the ability to hold gains through the end of the session, but support currently continues to build as August futures are holding near $144 per cwt. LEAN HOGS: Moderate pressure is holding across the lean hog futures complex with traders looking for additional direction from not only outside markets, but also the ability to somehow draw additional support back into the complex and stability in market fundamentals Even though pork values in the cutout report bounced higher early in the week, the continued pressure in cash markets and lackluster interest by most traders is keeping nearby and deferred contracts under light pressure. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.16 per cwt to $76.49 per cwt with the range from $73.00 to $78.50 per cwt on 2,767 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 144 loads selling with prices gaining $0.57 per cwt. Lean hog index for 6/30 is at $84.45, down 0.46 with a projected two-day index of $83.83 down 0.62. Rick Kment can be reached at rick.kment@dtn.com (CZ) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.