DTN Midday Livestock Comments 08/12 11:59

DTN Midday Livestock Comments 08/12 11:59 Livestock Futures Confined to Mixed Moves Friday Morning Light trade is seen through the entire livestock complex as traders remain focused on the softness in grain markets following the increased yield announcement in the USDA crop report. This created additional buyer support in nearby contract months, although deferred contracts remain generally unsupported. By Rick Kment DTN Analyst GENERAL COMMENTS: Trade activity late Friday morning is confined in narrowly mixed price shifts through the entire complex as softness in the grain market has continued to draw buyers back into nearby contracts. The focus on long-term demand uncertainty continues to limit deferred contract support. Corn prices are lower in light trade. September corn futures are 7 cents lower. Stock markets are lower in light trade. The Dow Jones is 44 points lower while Nasdaq is down 4 points. LIVE CATTLE: Live cattle futures have bounced higher and lower through the morning with traders taking a very cautious approach to the market with the focus on upcoming cash cattle market trade which has yet to develop. The softness through the grain complex following the USDA crop report is helping to spark renewed buyer interest in nearby contracts, but overall volume remains extremely light with most traders unwilling to actively step into the market at this point. Narrow price ranges are likely to continue to be seen through the rest of the session. This may be able to build momentum for a market bounce early next week, but the ability to hold cash cattle trade steady with last week's levels once all is said and done will go a long way in longer-term market support. Cash cattle trade remains quiet at this point as active trade may be delayed until after futures markets close. This could limit overall market shifts through the end of the week, but packers are expected to still need to fill additional needs before they call it a week. Bids are firming a bit from earlier in the week, but there may not be a significant bounce in prices from Northern trade seen earlier in the week. Bids in the South are at $117 to $118 per cwt, and $186 to $187 in the North. Beef cut-outs at midday are mixed $0.69 higher (select) and down $0.07 per cwt (choice) with moderate movement of 91 total loads reported (39 loads of choice cuts, 21 loads of select cuts, no loads of trimmings, 31 loads of ground beef). FEEDER CATTLE: Feeder cattle futures have bounced higher at midday following the bearish USDA crop report which posted a strong production boost for both corn and soybean yields. This has helped to pull markets off of sharp early losses, although at this point, only nearby contracts are able to move to positive price territory. Traders will continue to focus on the weakness in grain markets and potential cash cattle trade through the end of the day which could help to spark additional trade in the waning hours of the trading session. LEAN HOGS: August lean hog futures appear to have come to a resting point as contracts will expire at noon. It appears that prices will hold above $67 per cwt, which is a $8 per cwt premium over where October contracts will take over as front month futures. The shift to front month contracts below $60 per cwt is not a shock by any means to the market, but it does create some uncertainty as to just how much additional fundamental support can be seen through the remainder of the summer. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.39 per cwt to $60.06 per cwt with the range from $55.00 to $61.50 per cwt on 1,696 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 143 loads selling with prices adding $0.37 per cwt. Lean hog index for 8/10 is at $68.20, down 0.59 with a projected two-day index of $67.57 down 0.63. Rick Kment can be reached at rick.kment@dtn.com (CZ) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.