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DTN Midday Livestock Comments          11/21 11:54

   Cattle Futures Surge Higher Tuesday

   Firm gains in beef values and the development of cash cattle trade even 
though prices have slipped lower is sparking widespread triple-digit gains in 
all cattle futures. Hog markets remain under light pressure replacing 
early-week gains.  

By Rick Kment
DTN Analyst

GENERAL COMMENTS: 

   Triple-digit gains have quickly flooded into the cattle complex late 
morning. This is bringing additional market support to the cattle market, 
although the support is not expected to gain significant long term momentum 
given the previous market pressure and overall light volume. Hog futures have 
shifted lower in light trade Tuesday. Corn prices are higher in light trade. 
December corn futures are 1 cents per bushel lower. Stock markets are higher in 
light trade. The Dow Jones is 180 points higher while Nasdaq is up 64 points.

   LIVE CATTLE:

   Triple-digit support has moved back into the market late Tuesday morning 
with the focus on aggressive buyer support in feeder cattle futures as well as 
higher beef values and the development of cash trade Tuesday morning. Gains are 
tightly grouped even though volume remains lackluster in most areas with prices 
$1.10 to $1.50 per cwt higher in most regions. There continues to be increased 
buyer support which is likely to continue through the end of the session. These 
moves are not expected to gain long term support as the upward shifts are 
generally replacing losses seen Monday. Cash cattle trade has started to 
develop with sales through the South seen at $118 per cwt. These prices are 
generally $1 per cwt lower than last week. At this level, it is expected that 
most if not all of the trade in the South is likely to be wrapped up before the 
end of the day. Bids are seen across the North at $117 to $118 live and $186 
per cwt dressed. It is uncertain if trade will be seen before the day is over, 
or if feeders will hold out until Wednesday before pulling the trigger. Beef 
cut-outs at midday are higher, $0.73 higher (select) and down $1.63 per cwt 
(choice) with light movement of 83 total loads reported (40 loads of choice 
cuts, 21 loads of select cuts, 12 loads of trimmings, 9 loads of ground beef). 

   FEEDER CATTLE:

   Buyer support has quickly stepped back into the complex midday following 
lackluster market activity through much of the morning. Prices have rallied as 
much as $2.12 per cwt higher while setting session highs due to additional 
support focused on the development of cash market activity Tuesday. Prices 
could move even higher through the end of the session as very little market 
resistance is expected to develop through most of the session.  

   LEAN HOGS:

   Pressure is developing due to the light volume across the lean hog futures 
complex late Tuesday morning. Prices have backed away from early market support 
with traders easily giving back most of the early week gains which flooded into 
the complex. Prices are seen 40 to 90 cents per cwt lower with traders unable 
to bring additional volume back into the market which could allow markets to 
shift further lower through the end of the week. Cash prices are lower on the 
National Direct morning cash hog report. The weighted average price fell $0.29 
at $56.17 per cwt with the range from $51.00 to $57.00 on 5,120 head reported 
sold. Cash prices are unreported due to confidentiality on the Iowa/Minnesota 
Direct morning cash hog report. The National Pork Plant Report posted 201 loads 
selling with cutout values slipping $0.59 per cwt. Lean hog index for 11/16 is 
at $65.42 down $0.55 with a projected two-day index of $64.83, down $0.59.

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


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