DTN Midday Livestock Comments 09/09 12:13

DTN Midday Livestock Comments 09/09 12:13 Cattle Hit Daily Trading Limit October live cattle futures are limit higher at midday as buyer support flooded the market Friday morning. Back and forth market swings seen over the last week have created additional pendulum swings through the cattle complex, which continue to leave the market moving nearly out of control on a daily basis. By Rick Kment DTN Analyst GENERAL COMMENTS: Sharp gains have developed in cattle trade with live cattle future holding limit gains in October contracts. The ability to close at the limit gain of $3 per cwt will expand trading limits Monday and create additional momentum in the market early next week. Corn prices are mixed in light trade. September corn futures are 1/2 cent per bushel lower. Stock markets are lower in light trade. The Dow Jones is 232 points lower while Nasdaq is down 83 points. LIVE CATTLE: October live cattle futures have hit limit gains at midday with a $3 per cwt rally developing as buyers have flooded back into the complex. The up and down market shifts through the week has continued to remain exhausting to not only traders but also market watchers, but continues to keep the market in a sideways and wide trading range. But in order to make a significant break out of this market shift, prices will have to continue to shift significantly higher early next week in order to continue the support seen Friday. If this is done, additional support may be able to be found and long term support should be developed. Cash cattle trade appears to be done for the week with an estimated 30,000 head sold in Nebraska through the week. There are still a few bids developing in the North at $165 to $166, but it is unlikely that additional sales will need to be done. Prices are sharply lower than a week ago with markets falling $4 to $5 per cwt in the South and $8 to $9 per cwt in the North. Beef cut-outs at midday are mixed $0.37 higher (select) and down $1.20 per cwt (choice) with moderate movement of 92 total loads reported (49 loads of choice cuts, 23 loads of select cuts, 5 loads of trimmings, 15 loads of ground beef). FEEDER CATTLE: Triple-digit gains have developed Friday morning as buyers flooded back into the market to once again fill the gap left open from the gaping wound left by the selling pressure that developed Thursday. Nearby contracts are holding gains over $2 per cwt with the focus of limit higher live cattle futures as traders continue to focus on renewed buyer support. Although at this point the gains are essentially meaningless fundamentally and technically until they can reach through retracement levels, as these moves just continue to wander back and forth as seen previously through the last several days. LEAN HOGS: Sharp losses have quickly developed in lean hog futures trade as cattle buying support has quickly redeveloped. The shifts through the livestock market have seemed to have brought traders to move back and forth through the markets through the week based on the wide ranging price shifts during to the market volatility that has existed through the complex. Even though early market support seemed to keep markets content, the lack of support quickly limited by softer cash hog values, pushed front month lean hog values under $60 per cwt once again, pushing triple digit losses into nearby hog trade. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.75 per cwt to $57.14 per cwt with the range from $56.00 to $59.50 on 2,211 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 135 loads selling with prices gaining $0.33 per cwt. Lean hog index for 9/7 is at $64.16 down 0.35 with a projected two-day index of $64.20 up 0.04. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.