DTN Midday Livestock Comments 01/19 11:37

DTN Midday Livestock Comments 01/19 11:37 Mixed Trade Develops Friday Morning Trade remains mixed across livestock futures Friday morning with limited end of the week direction developing in cattle or hog markets. Traders are actively focusing on the afternoon release of the January Cattle on Feed report but appear to have most pre-report positions in place at this time. Rick Kment DTN Analyst GENERAL COMMENTS: Cattle futures are at a near standstill with mixed trade in a narrow to moderate range following the aggressive market rally that developed Tuesday. Friday trade is more focused on position adjustments at the end of the week and in front of the afternoon Cattle on Feed report. Hog futures have fallen slightly lower during morning trade, but with limited long-term direction seen in the market, widescale market shifts have been avoided at the end of the week. March corn is up 3 at $4.47 and March soybean meal is down $0.30 at $361.00. The Dow Jones Industrial Average is up 134.64 at 37,603.25. LIVE CATTLE: Live cattle futures eroded Friday morning from the sharp triple-digit gains that developed Thursday. Traders seem comfortable with the current market situation heading into the weekend and also the release of the January cattle on feed report. The report will not be able to be traded until Monday morning, which will give traders and analysts the entire weekend to digest overall potential shifts. The complex remains lower in all contracts, but losses have been limited at 10 to 40 cents per cwt at midday, which is not enough to set any directional market shift into play given the ability to move above short-term resistance price levels Thursday. Cattle on feed estimates are expected to be 102% of year-ago levels, which at this level, would put total feedlot inventory below 12 million head. If reports come in significantly higher than these expectations, then traders are likely to become less optimistic about short- and long-term supply consolidation. Cash cattle markets are going into Friday afternoon still generally quiet. There are more bids available, but at this point they are being easily passed by feeders. Bids of $170 live in the South and $272 to $273 in the North dressed basis are available. Asking prices are at $175 and higher live in the South and $275 and higher dressed in the North. It is very likely that most trade may be delayed until after the release of the Cattle on Feed Report. February live cattle are $0.38 lower at $174.45, April live cattle are $0.23 lower at $177.425, June live cattle are $0.25 lower at $174.275. Boxed beef prices are mixed: choice down $0.34 ($295.95) and select up $1.19 ($284.95) with a movement of 61.42 loads (41.25 loads of choice, 6.44 loads of select, zero loads of trim and 13.73 loads of ground beef). FEEDER CATTLE: Feeder cattle futures are mixed in a narrow trading range Friday morning as traders are focusing on price adjustments in front of the weekend break and the afternoon Cattle on Feed Report. Contracts are hovering between 50 cents lower and 5 cents higher, but there seems to be very little indication of widespread market shifts or directional changes following the strong upward shirt seen Thursday. The ability for Thursday's market move to post 2-month highs helped to rekindle the expectations of not only fundamental support quickly moving back into the cattle market, but also firming technical buyer indicators which will likely further draw noncommercial buyers back to the cattle market and feeder cattle complex in the near future. January feeders are $0.50 lower at $230.425, March feeders are $0.08 lower at $232.475 and April feeders are $0.05 lower at $237.70. LEAN HOGS: Lean hog futures have been generally quiet through morning trade Friday. The ability to bring some stability back into the market as traders try to adjust to recent price shifts is helping to build market consistency within the new but much narrower trading range which has developed over the last week. It appears that given the firmness in pork values and cash hog prices over the past couple of weeks, nearby lean hog futures have become much more comfortable hovering within a $2 per cwt trading range over the last couple of weeks. This may help to add additional buyer support through the last half of January. February lean hogs are $0.43 lower at $70.675, April lean hogs are $0.28 lower at $78.175 and May lean hogs are $0.35 lower at $83.75. Hog Prices are lower on the Daily Direct Morning Hog report, down $1.94 with a weighted average of $45.96, ranging from $39.00 to $50.00 on 1,086 head with a five-day rolling average of $45.82. Pork Cutouts totaled 134.06 loads with 117.92 loads of pork cuts and 16.14 loads of trim. Pork cutout values are up $0.68 at $88.57. Rick Kment can be reached at kmentrick@gmail.com (c) Copyright 2024 DTN, LLC. All rights reserved.