DTN Midday Livestock Comments 09/01 11:58

DTN Midday Livestock Comments 09/01 11:58 Live Cattle Markets Plummet Lower Cattle futures are trading sharply lower Thursday morning as follow-through liquidation continues to flood into the market. Hog markets remain lightly traded with early gains being limited by the bearishness seen in cattle trade. By Rick Kment DTN Analyst GENERAL COMMENTS: Sharp triple-digit losses continue to flood into the market on the first trading session of September. Contract lows have once again been set through live cattle futures, leaving the market vulnerable to additional pressure over the near future. Corn prices are higher in light trade. September corn futures are 7 cents per bushel higher. Stock markets are mixed in light trade. The Dow Jones is 10 points lower while Nasdaq is up 8 points. LIVE CATTLE: Live cattle futures attempted to hold markets stable through the early minutes of trade despite pressure seen midweek across the complex. But this attempt was quickly squashed by active market liquidation stepping back into the market. The focus through the complex continues to be driven by concern of additional long term losses as fundamentals remain extremely weak and seasonal pressure is expected to put even more pressure on the complex. Live cattle futures are nearing limit losses, as nearby trade is holding a $2.70 per cwt loss with little to no support expected to develop through the rest of the session. Cash cattle markets are showing light cleanup trade redeveloping in Texas at $110 per cwt, which is in line with trade earlier in the week. The tone of the market has already been set, and any cattle traded through the rest of the week are likely to be at previous price levels, although bids are starting to erode due to the pressure in futures markets. Bids can be seen in Nebraska Thursday morning from $170 to $175 per cwt. Beef cut-outs at midday are mixed $0.22 lower (select) and up $0.72 per cwt (choice) with light movement of 72 total loads reported (34 loads of choice cuts, 22 loads of select cuts, no loads of trimmings, 16 loads of ground beef). FEEDER CATTLE: Pressure continues to quickly develop through feeder cattle futures as traders look for additional widespread pressure to be seen through the entire cattle complex. Feeder cattle futures are currently trading $3.50 to $4 per cwt lower as the potential to hit daily trading limits with a $4.50 per cwt loss is extremely possible given the lack of additional support seen in the market. An inability to hold $140 per cwt in front month September contracts, now puts the attention on July lows of $133.45 per cwt as initial support. LEAN HOGS: Pressure in cattle futures during the morning Thursday has created spill over pressure to the lean hog futures complex which is now trading steady to 20 cents per cwt lower. Even though early gains were able to hold through most of the morning, the lack of follow-through buyer support as trader interest is starting to wane due to the upcoming holiday weekend. Prices are expected to wander in a mixed range through the rest of the session, although very little direction is likely to develop before the weekend. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.22 per cwt to $57.98 per cwt with the range from $53.00 to $60.00 per cwt on 3,296 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price fell $2.00 per cwt to $57.83 per cwt with the range from $57.00 to $60.00 per cwt on 161 head reported sold. The National Pork Plant Report reported 147 loads selling with prices adding $0.48 per cwt. Lean hog index for 8/29 is at $66.34 down 0.27 with a projected two-day index of $66.03 down 0.31. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.