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DTN Midday Livestock Comments          04/22 12:02

   Losses Sweep Through Complex Monday

   Firm pressure has quickly developed Monday morning with cattle and hog 
futures holding triple digit losses. There continue to be increased weakness 
through the entire complex, although volume remains sluggish.

By Rick Kment
DTN Analyst

General Comments

   Strong early week losses have quickly developed through all livestock trade 
with traders pulling away from previous gains seen last week. Concerns of 
growing beef supplies and uncertain China demand has sparked triple digit 
losses. Corn futures are lower in light trade. May corn futures are 1 3/4 cent 
lower. Stock markets are mixed in light trade. Dow Jones is 29 points lower 
with Nasdaq up 7 points. 


   Strong weakness in feeder cattle futures and generally pressure in most 
commodity markets is adding to softness in live cattle trade midday Monday. 
June futures are leading the complex lower with a $1.55 per cwt loss as traders 
adjust to larger than expected cattle on feed as of April 1. This continues to 
create concerns that additional market weakness may develop over the next few 
trading sessions. Traders seem to be sensitive about posting significant market 
shifts, which is likely to keep prices well contained in the current 
sideways-moving market. Cash cattle interest is quiet following firmer trade 
late last week. Show list distribution and inventory taking is expected to be 
the extent of trade as bids and asking prices are not expected until midweek or 
later in most areas. Boxed Beef cut-outs at midday are higher, $1.46 higher 
(select) and up $0.98 per cwt (choice) with light movement of 34 total loads 
reported (15 loads of choice cuts, 15 loads of select cuts, 4 loads of 
trimmings, 1 load of ground beef).


   Strong triple-digit pressure has quickly moved through feeder cattle trade 
with October through January futures leading the market lower with $2.30 to 
$2.50 per cwt losses. Traders are working through the larger-than-expected 
cattle placement levels seen on Thursday's report, which may spark additional 
underlying softness through the entire complex through the first half of the 
week. Trade volume has slowed at midday, but the weaker tone in the market is 
likely to be carried through the end of the session.


   Strong pressure has continued to develop through all lean hog futures trade 
with June futures leading the market lower with a $1.95 per cwt loss at midday. 
The inability to sustain buyer support at the end of last week has added 
uncertainty to the potential buyer interest through the end of the month. Even 
though traders continue to look for increased pork sales to China and focus on 
any potential trade agreement, the overall concern that the aggressive market 
structure early in the month may be overstated and hard to maintain long term 
is causing some traders to quickly reposition holdings, allowing for moderate 
to strong price losses Monday morning. Cash prices are lower on the National 
Direct morning cash hog report. The weighted average price fell $2.21 at $78.73 
per cwt with the range from $73.00 to $79.46, on 5,170 head reported sold. Cash 
prices are unreported due to confidentiality on the Iowa/Minnesota Direct 
morning cash hog report. Pork values firmed in early week activity despite 
limited volume. Pork cutouts added $0.46 per cwt at $87.70 per cwt with 111 
loads traded. Lean hog index for 4/18 is $81.02 up 0.39, with a projected 
two-day index is $81.54 up 0.52.

   Rick Kment can be reached at 


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