DTN Closing Livestock Comments

GENERAL COMMENTS:

From Friday to Friday livestock futures scored the following Changes: Dec LC, Off $0.97; Feb LC, Off $0.63; Jan FC, Off $0.90; Mar FC, Up $1.10, Dec LH, Up $2.65 Feb LH, Up $1.27. A very light cash cattle trade is being reported in parts of the North this afternoon at $125 live and $195 dressed. Bids in the South are at $126-$127 Live and $197 dressed. Corn futures closed down 1 cent in the December and unchanged in the July.

LIVE CATTLE:

Live cattle futures were mixed Friday afternoon, closing from 20 cents lower to 47 cents higher as early moderate gains slowly eroded due to lack of direction in cash markets and uncertainty concerning the impact of the Cattle on Feed report. December and February futures posted narrow losses on light trade, looking for more direction early next week. Deferred contracts were able to hold moderate gain based on extremely light volume through the Friday session and little additional market activity expected in the near future. Beef cut-outs: lower, off $1.69 (choice, $203.14) to down $2.39 (select, $190.95) with moderate demand and moderate to heavy offerings (67 loads of choice cuts, 29 loads of select cuts, 25 loads of trimmings, 20 loads of coarse grinds).

MONDAY'S CASH CATTLE CALL:

Steady. At mid-afternoon only light trade is seen in Nebraska at $195 per cwt, with most activity waiting for higher bids later in the day. Bids remain stagnant, but packers are going to have to dig deeper into their pockets to get access for next week's cattle deliveries in front of the holiday week. Asking prices remain at $131 and higher in the South and are not expected to waver much through the rest of the afternoon.

FEEDER CATTLE:

Feeder cattle futures posted strong gains Friday afternoon as traders focused on light volume ahead of the afternoon release of the Cattle on Feed report. January feeder cattle futures held a $1.20 per cwt gain, closing at $163.65 per cwt. The ability to maintain above the $160 per cwt level through the next couple weeks is expected to help draw additional commercial buying interest back into the complex through the remainder of 2015, helping to focus on increased demand support. CME cash feeder index: 11/19: $174.39, down $1.38.

LEAN HOGS:

Lean hog futures continue to rally based on strong commercial support flooding into front-month December. Friday buyer support helped push prices to $57.45 per cwt after a $2.05 per cwt rally in late-day trade. This has moved contracts nearly $6 per cwt over support prices seen on Monday, and continued to build additional market strength back into the complex as traders break for the weekend. Even though trade volume is expected to remain sluggish through most of next week, the potential to sustain the momentum seen this week could help to draw follow-through buying activity early next week. The pork carcass cut-out fell back moderately Friday, but did not give up all of Thursday's gain. Loins were $2.76 lower, picnics $2.17 lower, Ribs $3.68 lower and hams $2.67 lower. Butts were $0.85 higher and bellies were $3.27 higher. Pork cut-out: $73.14, down $1.25. CME cash lean 11/18: $55.87, off $0.17 (DTN Projected lean index for 11/19: $55.52, off $0.35).

MONDAY'S CASH HOG CALL:

Steady to 50 cents lower. Packers are primed and ready take on a strong Saturday schedule which, when said and done, may be close to 210,000 head, while next week schedules will likely push 435,000 each day with the exception of Thanksgiving Day. This will keep total hog numbers strong but is still not expected to be a problem with packers getting access to hogs. The move higher in futures markets will allow for firming cash markets next week, but not based on supply tightness in any way.

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

(AG)

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