DTN Midday Livestock Comments 07/30 11:13
Cattle Futures Sharply Higher at Midday
The cattle complex is well supported at midday with the feeder pit dominated
by triple-digit gains. On the other hand, lean hog contracts continue to be
under significant pressure thanks to sloppy cash business and nervousness over
late-summer pork demand.
By John Harrington
The cash cattle trade remains very quiet at midday with both bids and asking
prices poorly defined. However, it's a good bet that asking prices will remain
firm given the way futures seem to be advancing. Some showlists are priced
around $168 to $170 in the South and $265 to $270 in the North. According to
the midday report, the national hog base is 2.51 lower compared with the Prior
Day settlement ($118.00-123.00, weighted average $119.39). Corn futures are 1
to 5 cents lower.
Live cattle futures are higher at midday, up 65 to 107. Live cattle
contracts gapped higher ont he opening and have traded on a firm basis
throughout the morning. Contracts are supported by signs of strong late July
beef demand and friendly cash expectations. Beef cut-outs are sharply higher at
midday, up $1.69 (choice, $263.03) to $2.47 (select, $261.50) with light box
movement (55 loads of choice cuts, 23 loads of select cuts, seven loads of
trimmings, 25 loads of coarse grinds).
Feeder cattle futures are higher at midday, up 150 to 167. For the third
consecutive session, feeder cattle contracts are setting all-time record highs.
Further buying is encouraged by evidence of impressive cash strength and ideas
that replacement supplies will stay tight through the balance of the year.
Lean hog futures are lower at midday, down 60 to 175. Lean hog futures
continue to slump lower in late morning business. Nearby contracts are
especially pressured thanks to faltering fundamentals. Apparently, pork
producers continue to be aggressive sellers, recognizing decent feeding profits
on one hand and the likelihood of greater country receipts over the next
several months on the other. Carcass value fell back moderately at midday on
weakness in all cuts. Loins -3.44; butts -0.53; picnics -2.09; ribs -1.14; hams
-1.72; bellies -0.44. Pork cut-out: $129.40, down $1.73. CME cash lean 07/28:
128.91, off 0.85 (DTN Projected lean index for 07/29: 127.91, off 1.00).
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