DTN Midday Livestock Comments 08/27 11:58

DTN Midday Livestock Comments 08/27 11:58 Cattle Futures Hold Onto Gains Triple-digit gains continue to hold through the live cattle and feeder cattle markets Thursday. The inability to hold onto strong session highs above $2 per cwt in both markets is creating some erosion of price levels, but the bounce higher remains firmly planted. Hog futures have backed away from early pressure with prices hovering in a narrowly mixed range. By Rick Kment DTN Analyst GENERAL COMMENTS: Buyer interest has been intense through both live cattle and feeder cattle futures. The focus on gains over $2 per cwt has held through most of the morning based on the potential to bounce from previous market pressure seen earlier in the week. Buyer support is starting to erode at midday, pushing prices well off of session highs, as volume appears to have slowed significantly. Corn prices are higher in light trade. September corn futures are 1 cent per bushel higher. Stock markets are higher in active trade. The Dow Jones is 321 points higher while Nasdaq is up 103 points. LIVE CATTLE: Strong gains continue to hold triple-digit price rallies through the entire live cattle complex Thursday. But current trade levels are starting to slowly back away from session highs set during the morning, and could erode further before closing bell, even though it is not expected that all of the buyer support will erode before the end of the session. Cash cattle markets are undeveloped with just a few scattered bids of $144 per cwt seen in the South and $226 bids redeveloping in Nebraska. It is expected that trade will be pushed off until Friday, with packers doing very little to entice feeders to step back into the market at this point. Asking prices remain at $150 in the South and $236 and higher in the North. Beef cut-outs at midday are mixed, $0.07 Lower (select) and up $0.58 per cwt (choice) with light movement of 67 total loads reported (46 loads of choice cuts, 12 loads of select cuts, 8 loads of trimmings, 9 loads of ground beef). FEEDER CATTLE: August feeder cattle futures remain dead in the water, as these futures contracts inch toward expiration before the end of the trading session. It appears that August futures will be able to hold above $210 per cwt, leaving some questions as to what impact September contracts will have once they take over as front month futures, potentially under the $200-per-cwt level. Although September futures have traded over $200 per cwt through most of the morning, to expect the complex to close nearly $2 per cwt higher for the day is a tall order to ask of the complex, especially given the market weakness seen through the early part of the week. LEAN HOGS: Early losses seen through the lean hog futures complex have eroded to a narrowly mixed bag of choppy trade on either side of steady Thursday morning. With the cattle market and aggressive moves in the stock market gaining most of the attention Thursday, there is very little interest being shown through the rest of the complex. This could help to establish some more balanced trading ranges at current price levels, although the recent pressure in pork values could have further impact through the rest of the complex at the end of the month. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.77 per cwt to $72.90 per cwt with the range from $72.00 to $74.00 per cwt on 5,332 head reported sold. Cash prices are unreported due to confidentiality on the Iowa Minnesota Direct morning cash hog report. The National Pork Plant Report reported 153 loads selling with prices falling $0.47 per cwt. Lean hog index for 8/25 is at $78.79 unchanged, with a projected two-day index of $78.68, down 0.11. Rick Kment can be reached at [email protected] (BAS) Copyright 2015 DTN/The Progressive Farmer. All rights reserved.