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DTN Midday Livestock Comments          07/30 11:59

   Livestock Futures Back Away From Early Morning Gains          

   Strong support seen early Thursday morning has allowed for moderate pressure 
to slowly trickle into the market through the morning. This has led to mixed 
price levels through both cattle and hog futures, and limiting trade volume 
through the entire complex. 

By Rick Kment
DTN Analyst



GENERAL COMMENTS: 

   Moderate pressure has slowly developed through the morning in both cattle 
and hog futures, backing away from initial morning support seen in the complex. 
Traders remain focused on the lack of direction in price support through the 
late summer months and questions as to just how much price and demand support 
will be seen in both pork and beef values. Corn prices are higher in light 
trade. September corn futures are 4 cents per bushel higher. Stock markets are 
mixed in light trade. The Dow Jones is 7 points lower while Nasdaq is up 12 
points.

   LIVE CATTLE:

   Early market support seen in the cattle complex Thursday morning seems to 
have sparked some additional market pressure as buy orders quickly ran low, 
allowing for markets to move to mixed price levels through midday. The firming 
support in boxed beef markets was viewed as moderately supportive, but unable 
to draw additional interest back into the market. Cash cattle trade remains 
inactive, although bids are becoming much more available even though they are 
well below current asking prices. Bids in the South are at $143 per cwt, while 
dressed bids in the North are seen at $228 per cwt. Asking prices remain near 
$148 in the South and $236 and higher in the North. It is uncertain if packers 
and feeders will come to agreeable terms yet Thursday, or if trade will be 
pushed into Friday as each side tries to push their hand as much as possible at 
the end of the month. Beef cut-outs at midday are higher, 0.23 higher (select) 
and up 1.07 per cwt (choice) with light movement of 62 total loads reported (32 
loads of choice cuts, 13 loads of select cuts, 5 loads of trimmings, 12 loads 
of ground beef).

   FEEDER CATTLE:

   September feeder cattle futures have moved lower at midday as early buyer 
support seen in the complex has slowly but steadily eroded through the morning. 
Even though front month August and deferred contracts are holding narrow gains, 
the lack of underlying support and renewed buyer interest in the complex at the 
end of the week is creating some concerns that additional pressure may hold 
through the end of the month. 

   LEAN HOGS:

   The combination of cattle markets eroding from early session highs and the 
lack of support in the morning pork cutout report has sparked moderate to 
widespread pressure through the entire lean hog futures market. Trade activity 
has increased at midday as buyer support has turned silent, allowing for the 
entrance of selling pressure to overtake the market. Currently prices are 
limited to 20 to 50 cent per cwt losses, but it is uncertain just how much 
liquidation activity is just under the surface and willing to quickly flood 
into the market before the end of the week. Cash prices are lower on the 
National Direct morning cash hog report. The weighted average price fell $2.17 
per cwt to $73.09 per cwt with the range from $65.00 to $76.00 per cwt on 2,724 
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 155 loads selling with prices falling $0.99 per cwt. Lean hog index 
for 7/28 is at $78.33 down 0.03, with a projected two-day index of $78.51 up 
0.18.  

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


(BAS)

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