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DTN Midday Livestock Comments 11/29 11:42

29 Nov 2023
DTN Midday Livestock Comments 11/29 11:42 Cattle Market Support Continues Moderate to active follow-through support developed across livestock futures Wednesday morning as buyers continue to step back into the market, moving prices further from recent lows. Rick Kment DTN Analyst GENERAL COMMENTS: Triple-digit gains are seen in several livestock futures Wednesday morning as traders continue to react to the aggressive market moves in cattle trade Tuesday and focus on building short-term support into an already oversold market structure. Feeder cattle futures once again are leading the move higher, although price gains are a far cry from utilizing the expanded trading limits available during the Wednesday session. Limited additional direction is likely to be seen through the rest of the trading day with current buying interest seemingly well rooted and little to no fundamental or technical market shifts expected in the upcoming hours. Hog futures are mostly higher although lightly traded December contracts are steady to fractionally lower due to lack of market activity. March corn is up 3/4 at $4.743 and January soybean meal is down $3.30 at $427.2. The Dow Jones Industrial Average is up 63.37 at 35,480.35. LIVE CATTLE: Follow-through buyer support in live cattle contracts held through most of Wednesday morning with triple-digit gains seen during the first couple hours of trade. At midday, prices have slowly but steadily backed away from session highs, but the underlying firm tone that developed Tuesday seems to be holding at this point. Traders continue to back away from market lows set at the beginning of the week with the complex remaining oversold, although concerns that beef and cash values may not be able to show significant market gains over the upcoming days or weeks could limit further market support over next several days. April live cattle futures continue to lead the complex higher with traders essentially looking past any potential holiday and first quarter demand shifts, and into expected supply and demand issues through the spring and summer months. Movements in the feeder cattle Wednesday are likely to be one of the biggest market factors in nearby live cattle trade through the end of the trading session. Cash cattle trade remains undeveloped Wednesday morning following light scattered trade through the South both Monday and Tuesday. Live trade in the South has been seen at $173 to $175 per cwt, although interest in the North seems illusive at best. It is likely that more cattle will need to be sold in all areas, but the focus through the end of the week is likely to be based on dressed cattle sales in the North. So far Wednesday morning, asking prices are still hard to pin down with bids undeveloped in all areas. The inability to keep cash prices steady or higher from last week following the futures market rally could significantly dampen the overall tone of the market going into the month of December. December live cattle are $0.45 higher at $172.1, February live cattle are $0.58 higher at $173.4, April live cattle are $1.05 higher at $175.925. Boxed beef prices are lower: choice down $0.21 ($297.96) and select down $1.74 ($264.61) with a movement of 88.02 loads (52.12 loads of choice, 24.63 loads of select, 3.51 loads of trim and 7.76 loads of ground beef). FEEDER CATTLE: Feeder cattle futures have continued to lead the cattle market higher for the second consecutive trading session. The buyer support now moving into the market is focused more on the oversold status of the market rather than any new technical or fundamental changes in the cattle market. Over the last three months, spot month January contracts have fallen over $50 per cwt, moving to near contract low prices earlier in the week. There seems to be very little solid information that would point to traders justifying further widespread market pressure, but overall market factors still are not showing bearish signs that would bring aggressive market interest back into the complex at this point. The ability to help establish a moderate to firming market trend in the current range may be the biggest factor in helping to rebuild price confidence within the feeder cattle complex through the month of December. January feeders are $2.08 higher at $223.125, March feeders are $1.48 higher at $224.975 and April feeders are $1.48 higher at $228.90. LEAN HOGS: Lean hog futures have gained much needed support Wednesday morning with follow through buyer support moving into the complex. Lightly traded spot December contracts remain slightly lower at midday with most of the trade volume in early 2024 contract months. February futures have now moved back above $70 per cwt, rebounding over $3 per cwt from contract lows set early in the week. There is very little additional fundamental market news, which is likely to add significant support to the overall complex, but the ability to put even more distance between current price levels and recent contract lows should help add market support to price levels through the end of the week. December lean hogs are $0.13 lower at $68.8, February lean hogs are $1.23 higher at $70.25 and April lean hogs are $1.55 higher at $76.55. Hog Prices are higher on the Daily Direct Morning Hog report, up $2.04 with a weighted average of $61.44, ranging from $57.00 to $62.00 on 3,202 head with a five-day rolling average of $60.27. Pork Cutouts totaled 176.85 loads with 149.80 loads of pork cuts and 27.05 loads of trim. Pork cutout values are down $4.45 at $84.29. Rick Kment can be reached at ** Register now for DTN's Virtual Ag Summit on Dec. 5 and 6, a virtual event that offers discussions of farmland values, tax advice, the latest technological advances, and the challenges of having a family business. On Wednesday, Ag Meteorologist John Baranick will give an early glimpse of what to expect from the weather in 2024 and I'll give you my best assessment of where I think corn and soybean prices are headed in the year ahead. Register for this free event at Can't make it those two days? A recorded link will be provided, but you need to register. (c) Copyright 2023 DTN, LLC. All rights reserved.