DTN Midday Livestock Comments 07/29 12:09
Lean Hog Futures Retreat Farther at Midday
The lean hog pit remains under pressure at midday, disappointed by defensive
cash news and the market's inability of attract buying interest. On the other
hand, the cattle complex is mostly higher near the top of the hour with feeder
contracts once again gaining ground on their live counterparts.
By John Harrington
Cattle country is very quiet today with few bids reported. Some asking
prices have been identified around $168-170 in the South and $265-270 in the
North. According to the midday report, the national hog base is 0.56 lower (on
a very light test) compared with the Prior Day settlement ($120.00-122.00,
weighted average $121.02). Corn futures are 6-9 cents lower, pressured by long
liquidation and general ideas of a big crop in the making. The stock market is
bouncing higher at midday with the Dow back above 17,000. In general, Wall
Street is supported by upbeat earnings from corporations including Merck & Co.
and a better-than-expected report on consumer confidence. The Dow is 32 points
higher at this time with the Nasdaq positive by 13.
Mixed, up 55 to off 25. Although most contracts here are some higher in late
morning action, nearby contracts have been under modest pressure. Trade volume
seems quite slow as bulls and bear probably stall until cash prospects become
more clear. Beef cut-outs are sharply higher at midday, up $2.60 (choice,
$261.90) to $2.77 (select, $258.94) with light box movement (38 loads of choice
cuts, 32 loads of select cuts, five loads of trimmings, 14 loads of coarse
Up 20 to 100. For the most part, feeder issues are moderately higher at
midday, girded by follow-through buying and the recent $7 surge of the cash
index. Of course, we're again at a stage where every tick higher effectively
rewrites the record book.
Mostly 67 to 205 lower. Lean hog futures continue to come unglued,
apparently oblivious to either spot cash premiums or the ongoing waves of
bullishness in the cattle complex. Fourth-quarter contracts are holding up
better than either spot August or 2015 contracts, but that doesn't seem to be
saying much. Carcass value is significantly higher at midday thanks to decent
appreciation in all primals except the picnic. Pork cut-out: $133.46, up $2.52.
CME cash lean 07/25: 129.76, off 0.57 (DTN Projected lean index for 07/28:
128.91, off 0.85).
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