DTN Midday Livestock Comments          01/28 12:08

   Support Surfaces in Livestock Contracts 

   Traders are looking to the marketplace Tuesday and are seeking out buying 
opportunities after Monday's prices plummeted. 

By ShayLe Stewart
DTN Livestock Analyst

General Comments

   Shaking off the Monday blues, lean hog and feeder cattle contracts wasted no 
time Tuesday in looking to take back some of the position they lost in Monday's 
downfall. The live cattle complex is the only livestock sector fighting the 
forward movement, even though trade earlier Tuesday morning tried to move 
higher. March corn is up 4 1/4 cents per bushel, and March soybean meal is down 
$1.00. The Dow Jones Industrial Average is up 248.03 points, and the NASDAQ is 
up 135.56 points. 

   LIVE CATTLE 

   Live cattle contracts are the only livestock sector unwilling to re-evaluate 
Monday's move and continue to trade mostly lower. Earlier Tuesday morning, the 
complex flirted with the idea of progressing prices higher but has since 
dropped back below Monday's close in most contracts. February live cattle are 
up $0.17 at $122.45, April live cattle are down $0.20 at $121.10 and June live 
cattle are down $0.10 at $112.90. The countryside continues to echo with 
crickets, as feeders are unsure where to price cattle this week and packers 
haven't inquired on any pens yet. 

   On Friday, USDA will release its biannual cattle inventory report, which is 
expected to come out bullish in lower total cow-herd numbers. If this is the 
case, the report could be the bump that the live cattle market needs in order 
to shoot cash prices higher and out of the steady sideways trade. 

   Consigned to Wednesday's Fed Cattle Exchange, there are 477 head with two 
pens coming from Kansas and one pen from Texas. All cattle are offered with the 
one-to-nine-day delivery.

   Boxed beef prices are higher: choice up $0.15 ($213.74) and select up $2.59 
($213.09) with a movement of 61 loads (43.29 loads of choice, 7.14 loads of 
select, 0 loads of trim and 10.76 loads of ground beef). 

   FEEDER CATTLE 

   Feeder cattle contracts are up $0.27 to $0.62 throughout the complex as the 
feeder cattle market, like the other livestock contracts, is building some 
support into Tuesday's noon hour. January feeders are up $0.37 at $142.27, 
March feeders are up $0.62 at $135.80 and April feeders are up $0.37 at 
$138.37. With the January contract expiring in two short days, more interest in 
buying into the March contract, helping boost prices in that month.  

   LEAN HOGS

   The April 2020 contract is seeing growing support Tuesday morning as the 
board starts to make a comeback from Monday's panic selling. February lean hogs 
are up $0.55 at $66.50, April lean hogs are up $1.25 at $71.70 and May lean 
hogs are up $0.85 at $77.82. Monday afternoon's cash prices stepped higher, 
which could have helped insulate Tuesday's ability to move the entire board 
higher. 

   The projected lean hog index for 1/28/2020 is up $0.10 at $61.74, and the 
actual for 1/24/2020 is up $0.11 at $61.64. Hog prices are lower on the 
National Direct Morning Hog Report, down $0.27 with a weighted average of 
$53.62, ranging from $49.00 to $56.50 on 10,460 head sold and five-day rolling 
average of $52.70. Pork cutouts total 259.05 loads with 237.18 loads of pork 
cuts and 21.86 loads of trim. Pork cutout values: down $0.12, $77.64. 

   ShayLe Stewart can be reached shayle.stewart@dtn.com 


(CZ)

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