DTN Livestock Midday: Triple-Digit Gains Hold in Cattle

    Buying has quickly flooded into the cattle complex Thursday morning with cattle futures posting aggressive late-week support. This has broken through short-term highs set in late August as commercial buyers quickly return to the market.


    Strong gains have quickly developed in cattle futures as triple-digit gains have moved through short term resistance levels in both live cattle and feeder cattle markets. Lean hog contracts have turned lower as strong nearby losses quickly pulled back from the early-month support.

    Corn prices are lower in light trade. September corn futures are 2 cents lower. Stock markets are lower in light trade. The Dow Jones is 34 points lower while Nasdaq is down 2 points.


    Live cattle futures continue to hold strong triple digit gains, although buyers have backed away from session highs seen earlier in the morning. December contracts have broken through short-term resistance levels set in late August, which is helping to set the tone for the aggressive buyer support and creating technical support through the entire cattle complex.

    This buyer interest may continue to develop through the end of the session, with potential gains seen Friday.

    Cash cattle activity remains slow to develop Thursday morning with a few bids seen across cattle country at $101 to $102 live basis and $163 dressed basis. Asking prices are still hovering near $107 and higher live basis and $168 to $170 dressed. At this point it may be Friday before active trade develops, although the aggressive futures trade could spark some late-day movement through the market.

    Beef cut-outs at midday are slightly higher, $0.09 higher (select) and up $0.01 per cwt (choice) with light movement of 81 total loads reported (41 loads of choice cuts, 12 loads of select cuts, 20 loads of trimmings, 8 loads of ground beef).


    Feeder cattle futures are holding strong gains of $2 to $3 per cwt Thursday morning with aggressive support quickly moving back into the complex. Even though no new fundamental support is developing, the ability to move front-month contracts above highs set in late August has created technical support, and is sparking follow through buyer interest that may bring additional momentum at the end of the week.


    Strong early pressure has held through the morning, although volume has slowed following the initial surge of seller pressure Thursday morning. Nearby contracts continue to hold losses of $1.35 to $1.75 per cwt while deferred contracts remain 50 to 80 cents lower in light to moderate pressure.

    The overall lack of buyer interest in the last half of the week is not expected to be taken as a change in market direction at this point, but traders adjusting positions for now. But there is much more caution being placed on the upcoming market shifts over the next couple trading sessions, to determine if recent market support will be able to hold.

    Cash prices are lower on the National Direct morning cash hog report. The weighted average price fell $0.37 at $60.39 per cwt with the range from $55.00 to $61.00 on 6,084 head reported sold.

    Cash prices are higher on the Iowa/Minnesota Direct morning cash hog report. The weighted average price added $0.23 at $60.89 per cwt with the range from $59.00 to $61.00 on 3,789 head reported sold.

    The National Pork Plant Report reported 198 loads selling with prices falling $0.94 per cwt. Lean hog index for 9/5 is at $70.33 down $1.03 with a projected two-day index of $69.37, down $0.96.

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