DTN Livestock Midday: Lean Hogs Surge Higher

    Aggressive buyer support has flooded into lean hog futures trade Tuesday morning. This has pushed April futures $1.72 per cwt higher as traders continue to focus on firming fundamental support. Cattle markets remain sluggish in mixed trading ranges.


    Livestock futures are holding mixed trade Tuesday morning with strong triple-digit gains flooding into lean hog futures based on continued strong fundamental support early in the week. Mixed trade is seen across the cattle complex, even though prices have bounced off of session lows and could lead to additional late-day buying activity.

    Corn prices are lower in light trade. March corn futures are 2 cents lower. Stock markets are higher in light trade. The Dow Jones is 123 points higher while Nasdaq is up 43 points.


    Live cattle futures are mixed at midday after traders have slowly tried to battle their way back into the complex following moderate pressure through most of the morning. The overall tone of the market seems to be focusing on a more stable market direction following the firm pressure seen Monday and continued lack of strong fundamental support in all areas of the market.

    The bounce higher in beef values is helping to minimize some of the previous market pressure, but traders remain concerned that follow-through pressure may be seen through the market

    . August futures have dipped below $100 per cwt through the morning, adding additional concerns about the ability to sustain long-term buyer support through the complex. At midday nearby contracts are able to hold 10 to 22 cent gains, but this support is very limited as buyer activity remains sluggish at best.

    Cash cattle markets remain undeveloped with bids and asking prices still unavailable Tuesday morning. The expectation is that activity will be delayed until sometime Thursday or later as the lack of wide shift in futures trade may not spark additional active packer interest.

    Even though packers are expected to have entered the week short bought, there may not be a significant aggressive push to buy cattle early in the week given the recent pressure in futures markets.

    Beef cut-outs at midday are higher, $1.38 higher (select) and up $0.20 per cwt (choice) with light movement of 64 total loads reported (35 loads of choice cuts, 15 loads of select cuts, no load of trimmings, 13 loads of ground beef).


    Feeder cattle futures remain mixed in light trade following lackluster trade interest through most of the morning. The inability for live cattle futures to show much support until midmorning has limited trader activity in the feeder cattle complex and is limiting trade to a moderate range.

    Prices are hovering between 40 cents lower and 20 cents higher, as the concern of additional beef value pressure and commercial traders may slowly back away from the complex through the next couple of weeks. Traders currently are unable to firmly establish support with prices hovering slightly above the $121.72 per cwt short-term lows set at the end of January.


    Sharp gains have quickly developed across the lean hog futures complex with traders focusing on the April contracts which have rallied $1.72 per cwt higher at midday. The support has been slowly building through the morning, but there is very little expected pressure to develop before the end of the session.

    All contracts from April through August futures are holding triple digit gains, as traders found renewed support based on strong cash market support and the ability to post triple digit gains in pork cutout values. Front month February futures remain lightly traded. Even though futures are supported, the intensity in front month contracts is lacking based on the lack of open interest in the market.

    Cash prices are higher on the National Direct morning cash hog report. The weighted average price added $0.41 at $71.49 per cwt with the range from $66.00 to $74.00 on 6,086 head reported sold.

    Cash prices are higher on the Iowa Minnesota Direct morning cash hog report. The weighted average price gained $0.37 at $73.15 per cwt with the range from $66.00 to $74.00 on 2,817 head reported sold.

    The National Pork Plant Report reported 186 loads selling with prices up $1.45 per cwt. Lean hog index for 2/10 is at $74.11 up $0.60 with a projected two-day index of $74.62 up $0.51.

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