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DTN Midday Livestock Comments          03/18 11:48

   Light Gains Curbed By Market Uncertainty 

   Mixed trade has held through the entire morning in hog and cattle trade with 
traders still focusing on market firmness based on last week's gains. But the 
inability to sustain significant buyer interest early morning has kept price 
shifts well contained.

By Rick Kment
DTN Analyst

General Comments

   Mixed trade is seen through the entire livestock complex with continued 
gains redeveloping in nearby lean hog trade with April futures holding a 
triple-digit rally at midday. Cattle markets remain focused on the overall 
uncertainty of follow-through buyer support, with traders containing prices 
within current market ranges through most of the morning. Corn futures are 
lower in sluggish trade. May corn futures are 2 cents lower. Stock markets are 
lower in light trade. Dow Jones is 25 points lower with Nasdaq down 2 points. 

   LIVE CATTLE:

   Moderately mixed trade ranges have held through live cattle trade Monday 
morning with traders holding prices from 47 cents lower to 50 cents higher. 
Most of the activity has developed in nearby contracts as April and June 
futures are showing the greatest adjustment. With so much unknown about the 
impact of flooding and how this will impact cattle in feed yards as well as the 
cow/calf operations in many of these areas, traders continue to hover within 
the current market range which is likely to hold over the next several days. 
Cash cattle interest remains undeveloped with packers and feeders starting the 
weekly dance of show list distribution and inventory taking. Transportation 
issues are likely to be a major issue even if cash business gets done due to 
many flooded and damaged roads through the upper midwest. Boxed Beef cut-outs 
at midday are higher, $0.70 higher (select) and up $1.25 per cwt (choice) with 
light movement of 37 total loads reported (17 loads of choice cuts, 6 loads of 
select cuts, 5 loads of trimmings, 9 loads of ground beef).

   FEEDER CATTLE:

   Limited interest is seen in feeder cattle trade with prices hovering from 40 
cents lower to 45 cents higher in choppy up and down trade through the morning. 
The limited support in live cattle trade early Monday has helped to rekindle 
some buying activity, but the momentum of strong triple digit gains seen late 
last week seems to have quickly passed. Traders continue to try to balance 
short- and long-term market direction given the weather conditions and flooding 
conditions, impacting the upper half of cattle country. This could create more 
questions than answers over the near future, allowing for increased market 
volatility.

   LEAN HOGS: 

   Firm buyer support is slowly but steadily moving through the complex Monday, 
although most contracts have pulled back from initial triple digit gains which 
developed early Monday morning. Commercial buyer support has moved back into 
April lean hog trade, moving prices $1.50 per cwt, with prices shifting above 
$70 per cwt for the first time since mid-December. This may allow for 
additional late-day buying activity through most contracts. At this point, 
there appears limited aggressive buying on the sidelines which would move gains 
to expanded trading limits in the last hour of trade activity. This could help 
to bring steady but more stable buyer activity into the complex through the end 
of the week. Cash prices are higher on the National Direct morning cash hog 
report. The weighted average price added $1.09 at $55.01 per cwt with the range 
from $48.00 to $58.00 on 6,220 head reported sold. Cash prices are higher on 
the Iowa/Minnesota Direct morning cash hog report. The weighted average price 
added $1.39 at $56.87 per cwt with the range from $50.00 to $58.00 on 2,360 
head reported sold. Pork carcass values continue to gain momentum with strong 
triple-digit gains developing in most primal cuts. Pork cutouts gained $1.10 
per cwt at $69.99 per cwt with 135 loads traded. Lean hog index for 3/14 is 
$55.40, up $1.27, with a projected two-day index is $56.54, up $1.14.

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


(CZ)

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