DTN Midday Livestock Comments 12/02 12:10

DTN Midday Livestock Comments 12/02 12:10 Cattle Futures Implode at Midday Live and feeder futures are sharply lower near the top of the noon hour, unexpectedly hammered by aggressive long liquidation and technical-selling. For the most part, lean hog contacts are mixed with spot Dec and the far deferreds higher while Feb through August trade moderately lower. By John Harrington DTN Livestock Analyst GENERAL COMMENTS: With the board slumping badly to the south, potential for further feedlot sales this week seems to have come to a screeching halt. At least, we've picked up no bids nor indications that bullish-minded feedlot markets are prepared to accept less money than was available on Wednesday. The country business is probably done for the week. According to the midday report, the national hog base is $0.65 higher compared with the Prior Day settlement ($42.50-$48.50, weighted average $47.01). The corn market is several cents higher just before the noon hour, supported by commercial buying and improving ethanol margins. Equities are mixed near midday as traders sort through the jobs report and consider the possible implications of the pending Italian referendum. The Dow is currently 29 points lower with the Nasdaq better by 8. LIVE CATTLE: In an unexpected spasm of weakness, live futures continue to turn a blind eye toward higher feedlot sales and work significantly lower just before the weekend break. Trade talk wants to blame demand worries, especially once wholesale biz stretches beyond mid-month. Prices are currently 102 to 245 lower with deferreds holding up a little better than the front end. Besides the large premium of recent country sales, spot December should find technical support above its 100-day moving average at $107.50. Beef cut-outs are mixed at midday, up $0.66 (select, $173.59) to off $0.22 (choice, $190.29) with light box movement (17 loads of choice cuts, 10 loads of select cuts, 5 loads of trimmings, 14 loads of coarse grinds). FEEDER CATTLE: Feeders have fallen in the same defensive mode as their live counters with prices as much as 292 to 325 lower at midday. Spot January has fallen below its 100-day moving average at $125.50. If we close down here, technical bears will be frowning. On the other hand, it would put the lead contract nearly 500 points below the cash index, a discount that seems excessively given recent psychology. LEAN HOGS: Lean hog futures are mixed near the top of the noon hour with prices ranging from 80 higher to 40 lower. Spot December is receiving the best support from buyers thanks to this week's consistent appreciation of country sales. The carcass value closed lower with lower loin, picnic and ham cuts overshadowing better demand for butts, ribs and bellies. Pork cut-out: $74.03, off $0.29. CME cash lean index for 11/30: $48.80, up $0.58 (DTN Projected lean index for 12/01: $49.52, up $0.72). John A. Harrington can be reached at john.harrington@dtn.com (ES) Copyright 2016 DTN/The Progressive Farmer. All rights reserved.