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DTN Midday Livestock Comments          10/12 13:03

   Cattle Futures Tumble Lower 

   Sharp follow-through losses have developed in feeder cattle trade at midday. 
This is putting pressure through the entire cattle market with limited volume 
keeping markets sluggish.

By Rick Kment
DTN Analyst

   Cattle futures are under firm pressure Friday morning following increased 
sharp losses in feeder cattle trade. The combined shift in firming grain 
markets through the end of the week and general beef market pressure is leading 
to triple-digit losses in all feeder cattle futures. Corn markets are higher in 
light trade. December corn futures are 4 cents higher. Stock markets are higher 
in light trade. The Dow Jones is 125 points higher while Nasdaq is up 102 
points.

   LIVE CATTLE:

   Light-to-moderate pressure is seen in live cattle futures with losses of 2 
to 40 cents per cwt through the morning. Sharp losses seen in feeder cattle 
trade seem to be the main driver of the pressure that has entered into the 
complex as traders look for increased market stability through the end of the 
week. Cash cattle activity appears to be done for the week following 
light-to-moderate trade in all areas Thursday. Cash cattle traded at $111 live, 
fully steady with last week, and $173 to $174 dressed, which is $1 to $2 lower 
than last week. Boxed beef cut-outs at midday are higher, $0.69 higher (select) 
and up $0.38 per cwt (choice) with moderate movement of 77 total loads reported 
(41 loads of choice cuts, 7 loads of select cuts, 15 loads of trimmings, 12 
loads of ground beef).

   FEEDER CATTLE:

   Sharp triple-digit losses have redeveloped through the feeder cattle complex 
Friday morning with increased weakness seen across the entire cattle complex. 
This aggressive turn lower in feeder cattle futures is creating additional 
longer-term uncertainty through the entire market. October feeder cattle 
futures are leading the complex lower with a $1.80 per cwt loss, moving prices 
below $155 per cwt for the first time since the middle of September. This could 
lead to additional pressure early next week.    

   LEAN HOGS:

   Light trade is seen in lean hog futures trade with nearby gains offsetting 
narrow deferred losses. The focus on firm gains in December lean hog futures is 
helping to limit longer-term market pressure. But losses in deferred futures 
seem to be limiting the overall support. Light trade is likely to be seen over 
the next couple hours, with limited interest. Cash prices are unreported due to 
confidentiality on the National Direct morning cash hog report. Cash prices are 
unreported due to confidentiality on the Iowa/Minnesota Direct morning cash hog 
report. The National Pork Plant Report posted 130 loads selling on the morning 
report. Pork carcass values gained $0.11 per cwt at $79.31 per cwt. Lean hog 
index for 10/9 is at $69.34, up $0.01, with a projected two-day index of 
$69.28, down $0.06.

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


(SK)

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