DTN Midday Livestock Comments 09/30 11:49

DTN Midday Livestock Comments 09/30 11:49 Cattle Futures Fall Below $100 Per Cwt October Live cattle futures post limit losses Friday morning with losses pushing prices below $100 per cwt. This lack of support impacted the entire market. Lean hog futures have also added to long term losses by taking out contract lows as December contracts have moved below $45 per cwt. By Rick Kment DTN Analyst GENERAL COMMENTS: Stability seen midweek in livestock markets was unable to hold Friday morning as traders flooded the market ready to liquidate positions at the end of September. October live cattle futures are locked in limit losses of $3 per cwt with prices under $99 per cwt as buyer interest was unwilling to step in front of the massive steamroller and prices plummeted lower. Lean hog and feeder cattle markets are holding contract lows in aggressive triple digit losses late Friday morning. Corn prices are higher in light trade. December corn futures are 5 cents lower per bushel. Stock markets are higher in light trade. The Dow Jones is 181 points higher while Nasdaq is up 49 points. LIVE CATTLE: Any hope of rebuilding support in the live cattle futures complex at the end of September was quickly dashed early Friday morning as sharp losses flooded into the complex. Triple digit losses are seen in all contracts with limit losses holding front month October futures locked under $100 per cwt at $98.90 per cwt. A close at this level would be the first monthly close under $100 per cwt in over six years, and an extremely bearish way to start out the fourth quarter and month of October. December live cattle futures are closely following the direction of October contracts, yet not at limit losses at midday, but flirting with that level. This pressure continues to create uncertainty through the entire complex, limiting commercial and investment interest. Cash cattle trade is expected to be essentially done for the week, although there are reports of a few bids seen in the south at $103 per cwt and $160 in the North. But given the limit losses in live cattle futures at midday, it is uncertain and relatively unlikely if these bids will still hold. Beef cut-outs at midday are lower $0.01 lower (select) and down $1.83 per cwt (choice) with light movement of 83 total loads reported (31 loads of choice cuts, 12 loads of select cuts, 16 loads of trimmings, 23 loads of ground beef). FEEDER CATTLE: Sharp losses quickly moved into feeder cattle futures Friday morning, although after initial pressure developed, trade volume slowed, and markets remained under pressure in light trade. October feeder cattle futures are holding $3 per cwt losses at midday at $124.50 per cwt while the rest of the complex is trading from $3.25 to $4 per cwt lower as traders are focused on the overall lack of support in the entire livestock market as well as the widespread pressure and limit losses in live cattle contracts. A close at these lows would be the lowest monthly low since 2010. LEAN HOGS: Lean hog futures have once again futures quickly fallen through any sense of thin layer of support that may have been holding the market together over the last couple of days. After initial buyer support was unable to hold at opening bell, sellers quickly moved back into the market and moved through contract lows like they were hot butter. This quickly left the door open for unsupported markets and moved contracts wide open to fall aggressively lower as nearby contracts are trading $2.50 to $2.70 per cwt lower at midday. October contracts have fallen under $50 per cwt in the history of the contract while December contracts have moved to below $45 per cwt at $44.40 per cwt. Long term support in remains at $43 per cwt which still leaves markets room to fall before traders have reason to step back into the market. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $1.08 per cwt to $47.87 per cwt with the range from $46.00 to $49.00 on 2,168 head reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash hog report. The weighted average price fell $1.09 per cwt to $48.13 per cwt with the range from $46.00 to $48.50 on 208 head reported sold. The National Pork Plant Report reported 145 loads selling with prices adding $0.12 per cwt. Lean hog index for 9/28 is at $57.35 down 0.28 with a projected two-day index of $56.80 down 0.55. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.