DTN Midday Livestock Comments          03/19 11:46

   Price Positioning Seen in Hog Trade

   Light to moderate softness is seen in lean hog trade with increased 
underlying pressure holding across the entire complex. This may start to limit 
recent buyer optimism over the next couple of days. Cattle trade has surged 
higher following early triple-digit gains.

By Rick Kment
DTN Analyst

General Comments

   Strong triple-digit gains have continued to develop through cattle trade as 
significant morning buying in feeder cattle trade has sparked increased 
underlying support through the entire complex. Hog futures have slowly eroded 
late morning, although the recent market support is still keeping most traders 
generally bullish. Corn futures are lower in sluggish trade. May corn futures 
are 2 cents lower. Stock markets are higher in light trade. Dow Jones is 165 
points higher with Nasdaq up 50 points. 

   LIVE CATTLE:

   Firm gains have quickly moved back into the live cattle complex following 
lackluster interest that kept prices generally steady most of the morning. 
April live cattle futures are leading the complex higher with a 90 cent per cwt 
gain. This upward movement continues to spark commercial interest, but with 
prices still well entrenched within the current market range, it is likely that 
prices could hover within these price levels over the near future with very 
little long term market direction developing. Cash cattle activity is still 
quiet with bids undeveloped at this point and may remain unavailable until 
midweek or later. There have been a few asking prices trickling into the market 
with cattle priced at $132 live and $210 dressed. Significant trade will likely 
be seen through the end of the week at this point. Boxed Beef cut-outs at 
midday are higher, $1.16 higher (select) and up $1.73 per cwt (choice) with 
light movement of 63 total loads reported (37 loads of choice cuts, 11 loads of 
select cuts, no loads of trimmings, 15 loads of ground beef).

   FEEDER CATTLE:

   Triple-digit gains have continued to move back into the complex with April 
and May feeder cattle trade leading the complex higher. April futures have 
moved to $147.65 per cwt following continued market support through the entire 
complex. Underlying concerns of cattle losses due to Midwest flooding is adding 
to price support, although at this point it is nearly impossible to correctly 
assess the overall market damage to the cattle herd and the overall beef 
industry.

   LEAN HOGS: 

   Initial buyer support quickly stepped away from the market with June futures 
leading the complex lower with a $1.10 per cwt loss. This pullback in all 
nearby contracts has caused traders to slowly step back from recent market 
gains seen over the last couple of weeks. Even though firm fundamental support 
is developing through the entire complex, the focus on market correction seems 
to be the theme through the week. Cash prices are lower on the National Direct 
morning cash hog report. The weighted average price fell $0.46 at $55.80 per 
cwt with the range from $52.00 to $57.50 on 2,985 head reported sold. Cash 
prices are unreported due to confidentiality on the Iowa/Minnesota Direct 
morning cash hog report. Pork carcass values sparked additional underlying 
support with triple-digit gains seen in all primal cuts. Pork cutouts gained 
$1.51 per cwt at $73.90 per cwt with 230 loads traded. Lean hog index for 3/15 
is $56.54, up $1.14, with a projected two-day index is $57.54, up $1.00.

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


(CZ)

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