DTN Midday Livestock Comments 10/27 11:38

DTN Midday Livestock Comments 10/27 11:38 Triple-Digit Gains Hold Across Livestock Complex Strong gains have developed in livestock markets as traders continue to focus on follow-through buyer support moving into the complex. Firm commercial interest is seen in nearby cattle and hog contracts Thursday morning, pushing prices to triple-digit gains. By Rick Kment DTN Analyst GENERAL COMMENTS: Strong gains have developed across livestock futures with nearby futures holding gains from $1 to $1.50 per cwt support in cattle and hog trade at midday. The ability to continue to draw support into the market consistently through the market may continue to spark additional buyer activity into the complex. Corn prices are higher in light trade. December corn futures are 5 cents higher per bushel. Stock markets are mixed in light trade. The Dow Jones is 50 points higher while Nasdaq is down 21 points. LIVE CATTLE: Firm buyer support has quickly moved back into the market early Thursday morning as additional commercial buying has flooded back into the complex. The ability to aggressively draw additional open interest to the market is sparking additional interest in nearby and deferred contracts, and pushing nearby prices to triple-digit gains. Even though gains are holding, little new support is seen in the market through midday with October live cattle futures holding a $1.50 per cwt gain, near the price level seen during most of the morning. Cash cattle markets are starting to firm with bids quickly developing through the morning Thursday. Bids in the South are seen from $102 to $104, which is steady to $2 per cwt higher than last week. Northern bids are seen at $160 at this point. Asking prices are seen at $105 to $105 in the South and $165 and higher in the North with no sign that feeders will pull back from those levels at this point. Trade may be delayed until sometime Friday. Beef cut-outs at midday are mixed $0.08 higher (select) and up $0.78 per cwt (choice) with moderate movement of 93 total loads reported (40 loads of choice cuts, 37 loads of select cuts, 7 loads of trimmings, 9 loads of ground beef). FEEDER CATTLE: Strong buyer support once again develops in feeder cattle futures with triple-digit gains developing in most feeder cattle contracts. November contracts are trading at $125 per cwt holding at $1.07 per cwt rally at midday following the triple digit rally seen through the nearby live cattle market. The underlying firm support seen through the entire week in cattle trade continues to draw firm but consistent commercial support as traders have moved from contract lows and are making the case for a strong market rally that could gain additional momentum through the next couple of weeks if additional cash market support develops. LEAN HOGS: Trade across the lean hog complex remains sluggish at midday as gains continue to hold through the morning. Even though prices have backed slightly away from session highs due to the lack of trader intensity moving into the market, the ability to keep prices hovering over triple digit gains in nearby contracts is helping to sustain market support and likely bring about additional long term stability through the complex. December futures are trading above $45 per cwt for the first time since late September, which continues to move away from contracts lows of $41.10 per cwt. Each trading session that traders can remove themselves from that level, makes it easier to break the trend and look forward to shifting toward a new market direction through the month of November. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.59 per cwt to $44.22 per cwt with the range from $43.00 to $45.50 on 6,528 head reported sold. Cash prices are higher on the Iowa Minnesota Direct morning cash hog report. The weighted average price gained $0.23 per cwt to $45.24 per cwt with the range from $43.00 to $45.50 on 2,655 head reported sold. The National Pork Plant Report reported 206 loads selling with prices slipping $0.02 per cwt. Lean hog index for 10/25 is at $51.70 up $0.03 with a projected two-day index of $51.85 up $0.15. Rick Kment can be reached at rick.kment@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.