DTN Midday Livestock Comments 09/01 11:56

DTN Midday Livestock Comments 09/01 11:56 Cattle Futures Follow Outside Markets Lower Heavy influence has been seen from outside markets Tuesday morning with stock markets posting triple-digit losses in both Dow Jones and Nasdaq markets. This has led to sharp losses across the cattle complex. By Rick Kment DTN Analyst GENERAL COMMENTS: Strong pressure is seen through cattle trade Tuesday morning as traders focus on the lack of support in most other outside markets and quickly back away from previous gains. Lean hog futures are holding up well with most contracts slightly higher at midday despite the widespread softness in outside markets. Corn prices are lower in light trade. September corn futures are 6 cents per bushel lower. Stock markets are lower in light trade. The Dow Jones is 385 points lower while Nasdaq is down 105 points. LIVE CATTLE: Live cattle market have turned lower in a uniform pattern with losses at midday contained between $1.40 and $1.80 per cwt. The lack of strong support in boxed beef values was not a surprise to the overall market, but the aggressive widespread pressure through most all commodity and financial markets led to consistent and concise pressure through the entire market. It is uncertain just how much long-term damage this move will create, but a move below last week's lows in October futures is possible if losses reach near daily trading limits. This would create widespread uncertainty into the market. Cash cattle activity remains quiet with just a few scattered bids through the South at $144 per cwt. It is uncertain if this will bring any interest to the market given the aggressive pressure in futures trade. Asking prices are not fully developed, but around $148 to $150 per cwt in the South and $232 and higher in the North. Beef cut-outs at midday are mixed, $0.28 higher (select) and down $0.46 per cwt (choice) with light movement of 84 total loads reported (49 loads of choice cuts, 20 loads of select cuts, 9 loads of trimmings, 7 loads of ground beef). FEEDER CATTLE: Feeder cattle futures are leading the entire cattle complex lower with losses at or near $3 per cwt through most contracts. The focus in the cattle market is driven by outside market pressure as strong triple-digit losses are seen in the Dow Jones Index while energy and grain markets have turned aggressively lower during morning trade. The test in the feeder cattle market will be if October futures will be able to maintain support levels at last week's lows of $194.35 per cwt. A break below that is still possible given the current trading limit, but would spark additional bearish undertones through the entire complex. LEAN HOGS: Despite the aggressive downward turn in most commodity and financial markets, lean hog futures are holding in there nicely Tuesday morning. Although most of the morning, nearby lean hog futures posted narrow losses, the ability for firm pork value support to redevelop in the morning cutout report and deferred market strength has pushed the complex mostly higher. Even though gains are not aggressive Tuesday morning, the ability to hang around near unchanged price levels, with several contracts moderately higher is impressive in itself. Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.84 per cwt to $71.90 per cwt with the range from $64.00 to $71.50 per cwt on 6,100 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 250 loads selling with prices adding $0.99 per cwt. Lean hog index for 8/28 is at $77.70 down 0.58, with a projected two-day index of $77.23, down 0.47. Rick Kment can be reached at [email protected] (BAS) Copyright 2015 DTN/The Progressive Farmer. All rights reserved.