DTN Midday Livestock Comments          06/18 11:59

   Hog Buyers Step Back Into The Market  

   Strong support is seen in nearby lean hog trade with triple-digit support 
developing in front month futures. Cattle trade remains sluggish with limited 
interest seen through the entire complex. 

By Rick Kment
DTN Analyst

GENERAL COMMENTS: 

   Strong underlying support is moving into the lean hog futures complex 
through late morning. This is still limiting trade volume in all markets, as 
traders continue to focus on outside market shifts as well as potential cash 
trade activity. Corn prices are lower in light trade Thursday. July corn 
futures are 4 cents lower. Stock markets are lower in light trade. The Dow 
Jones is 155 points lower while Nasdaq is down 19 points.

   LIVE CATTLE:

   Live cattle futures are holding from 57 cents lower in deferred contracts to 
40 cents higher in nearby summer futures. The focus on strong gains late last 
week has quickly offset early morning losses. This could bring some additional 
pressure to the complex which will likely keep prices contained in a narrow 
range through most of the session. Cash cattle interest remains quiet with very 
limited activity seen on either side of the market. Bids and asking prices are 
unavailable at this point and not likely to be seen until midweek. The choppy 
shifts in futures trade is likely to limit overall cash market direction, and 
active trade may not develop until the last half of the week. Boxed Beef 
cut-outs at midday are higher, $1.54 higher (select) and up $1.49 per cwt 
(choice) with light movement of 58 total loads reported (23 loads of choice 
cuts, 11 loads of select cuts, 11 loads of trimmings, 12 loads of ground beef). 

   FEEDER CATTLE:

   Light trade is keeping prices mixed in feeder cattle trade. The support seen 
late last week has helped to spark some midmorning buyer support across the 
complex. August futures are leading the market with a 35 cent per cwt gain, 
with increased underlying support seen through the market. Although nearby 
contracts have not been able to break away from the $148 per cwt level, the 
focus on increased support could draw increased activity later in the week. 

   LEAN HOGS:

   Firm buyer support is quickly moving into the lean hog futures trade with 
July futures holding a $1.50 per cwt rally. The expectation that additional 
support is moving into the complex based on overall tighter hog supplies that 
may continue through the summer months could add some underlying support to the 
complex. This has moved July futures to $83.20. Front month futures are at the 
highest level since February, with commercial support still quickly moving back 
into the market. Cash prices are higher on the National Direct morning cash hog 
report. The weighted average price is up $0.04 at $83.01 per cwt with the range 
from $76.00 to $84.00 on 3,181 head reported sold. Cash prices are unreported 
due to confidentiality on the Iowa/Minnesota Direct morning cash hog report. 
The National Pork Plant Report posted 106 loads selling with carcass values 
falling $0.25 per cwt. Lean hog index for 6/14 is at $81.44 up 1.35 with a 
projected two-day index of $82.86, up 1.42.

   Rick Kment can be reached at rick.kment@dtn.com 


(SK)

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