DTN Midday Livestock Comments 07/31 12:06
Cattle Futures Slammed at Midday by Outside Markets
The cattle complex is sharply lower at midday with triple-digit losses
dominating both pits. On the other hand, lean hog futures are mixed, retreating
from the impressive highs of early session.
By John Harrington
Cattle country remains essentially quiet near the top of the noon hour with
just a few bids reported in pats of the North at $255-259. Asking prices are
holding firm $168-170 in the South and $265-270 in the North. According to the
midday report, the national hog base is 2.25 lower compared with the Prior Day
settlement ($111.00-120.00, weighted average $117.74). Corn futures are 1-4
cents lower, pressured by poor export sales and a general lack of price
supporting factors. The stock market is struggling at midday with the Dow off
more than 200 points. Wall Street analysts are blaming fears of European
deflation, higher labor costs, and the possibility of higher interest rates.
Note that the U.S. dollar index seems to be moving higher.
Mostly 115 to 232 lower. Live contracts are struggling today, partially
thanks to pre-cash profit taking and partially thanks to bearish vibes from
outside markets. Trade volume is said to be quite light. Beef cut-outs are
higher at midday, up 0.54 (select, $261.37) to $1.60 (choice, $264.52) with
light box movement (37 loads of choice cuts, 21 loads of select cuts, one load
of trimmings, 11 loads of coarse grinds).
Off 192 to 300. Feeders are definitely taking a breather today, pressured by
the same considerations stated for the defensive tone in the live pit. Perhaps
action here had simply become too hot not to cool off.
Mixed, up 45 to off 75. Lean hog contracts enjoyed a short-covering rally
through midsession or so, but the selling bias has resurfaced over the last
hour. Summer fundamentals remain disappointing with pork demand faltering
despite a significant reduction of tonnage on the street. Carcass value is
sharply lower at midday with all primals quoted lower except the rib. Pork
cut-out: $128.52, off $1.71. CME cash lean 07/29: 127.91, off 1.00 (DTN
Projected lean index for 07/30: 126.83, off 1.08).
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