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DTN Midday Livestock Comments          07/07 11:58

   Cattle Futures Slip Lower in Sluggish Trade              

   Softness through the cattle complex has followed additional outside market 
weakness that continues to develop as traders remain concerned about global 
economic conditions. Trade volume is likely to be light through the rest of the 
session. 

By Rick Kment
DTN Analyst



GENERAL COMMENTS: 

   Moderate losses are holding through the cattle complex as traders continue 
to focus on the uncertainty in outside markets as well as weaker beef values. 
Nearby lean hog futures are holding onto early gains, but it remains uncertain 
if there will be enough follow through support to hold these gains. Corn prices 
are lower in light trade. September corn futures are 4 cents per bushel lower. 
Stock markets are lower in light trade. The Dow Jones is 70 points lower while 
Nasdaq is down 42 points.

   LIVE CATTLE:

   Pressure is still holding in the live cattle futures. The lack of support 
through the rest of the commodity markets combined with moderate to strong 
pressure in the boxed beef values is creating some additional softness through 
the rest of the market. Trade volume is expected to remain sluggish through the 
remainder of the trading session as traders seem to have found a temporary 
range, and are willing to hold until later in the week. Cash activity remains 
quiet with bids still undeveloped. It is likely to be the second half of the 
week before sales start to develop. Asking prices are around $153 and higher in 
the South and $245 and higher across the North. Beef cut-outs at midday are 
lower, 2.24 lower (select) and down 0.99 per cwt (choice) with light movement 
of 69 total loads reported (28 loads of choice cuts, 25 loads of select cuts, 
zero loads of trimmings, 15 loads of ground beef).

   FEEDER CATTLE:

   Moderate pressure continues to hold through the morning after the initial 
buyer support quickly backed away from the table during early trade. This could 
help to draw additional volume into the market, although losses continue to 
remain limited, and could remain between 50 and 80 cents per cwt until market 
settles at 1 p.m. 

   LEAN HOGS:

   Light to moderate buyer support continues to remain rooted in nearby lean 
hog futures as traders continue to focus on the potential for a post-holiday 
market rally. The expectation that additional but moderate cash market support 
may continue to hold in cash hog values over the next few days is helping to 
push nearby lean hog futures near the $80 per cwt level. It is unlikely that a 
significant move higher will develop over the near future based on the 
availability of hogs in the market, but this could spark some additional 
rebuilding trough the entire complex. Cash prices are lower on the National 
Direct morning cash hog report. The weighted average price fell $1.58 per cwt 
to $73.21 per cwt with the range from $70.00 to $76.00 per cwt on 3,158 head 
reported sold. Cash prices are lower on the Iowa Minnesota Direct morning cash 
hog report. The weighted average price fell $3.17 per cwt to $73.96 per cwt 
with the range from $70.00 to $76.00 per cwt on 148 head reported sold. The 
National Pork Plant Report reported 218 loads selling with prices slipping 
$0.26 per cwt. Lean hog index for 7/2 is at $77.13 up 0.09, with a projected 
two-day index of $77.43 up 0.30.  

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


(BAS)

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