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DTN Midday Livestock Comments          12/12 11:52

   Cattle Futures Surge Higher Midday Tuesday

   Aggressive buying has flooded into cattle trade with live cattle and feeder 
cattle posting gains above $2 per cwt at midday. This strong support may help 
to spark increased longer-term activity through the next few days.

By Rick Kment
DTN Analyst

GENERAL COMMENTS: 

   Aggressive triple-digit gains have flooded into cattle markets following the 
recent widespread liquidation over the last couple of weeks. Nearby contracts 
are holding gains above $2 per cwt in both live cattle and feeder cattle trade. 
This is supporting follow-through buying. Corn prices are higher in light 
trade. March corn futures are 3 cents per bushel higher. Stock markets are 
higher in light trade. The Dow Jones is 138 points higher while Nasdaq is up 2 
points.

   LIVE CATTLE:

   Strong buyer support has quickly and aggressively moved into live cattle 
trade Tuesday morning. This has pushed nearby contracts $1.50 to $2.50 per cwt 
higher at midday with underlying support building through all contracts. This 
is creating additional buyer support in February through June contracts as 
buyers who have been on the sidelines during the recent market pressure are 
very willing and able to step back into the complex. Follow-through support is 
expected to be seen through the end of the session, although prices may not 
move significantly higher before closing bell. Cash cattle activity remains 
undeveloped at this point with bids and asking prices hard to find through most 
of cattle country. Active trade is expected to be delayed until late in the 
week. The surge in futures prices may help to improve early week bids, but not 
likely to spark trade volume at this point. Beef cut-outs at midday are higher, 
$0.32 higher (select) and up $0.29 per cwt (choice) with light movement of 69 
total loads reported (36 loads of choice cuts, 13 loads of select cuts, 7 loads 
of trimmings, 13 loads of ground beef). 

   FEEDER CATTLE:

   Sharp triple-digit gains have quickly developed across all cattle trade as 
the aggressive pressure over the last couple of weeks has sparked some 
underlying buyer interest through nearby and deferred contracts. The focus 
continues to be placed on the recent moves in live cattle trade and is sparking 
delayed support in feeder cattle futures. Nearby contracts are holding gains of 
$2 to $2.50 per cwt as traders try to move markets higher and establish a sense 
of support through the week. 

   LEAN HOGS:

   Lean hog futures have remained sluggish early Tuesday morning with 
front-month December futures able to hold onto moderate gains of 30 cents per 
cwt. The rest of the complex is focusing on follow-through market pressure as 
prices are holding consistent losses of 30 to 40 cents per cwt. The general 
lack of support in the market remains the focus through most of the trading 
session and will likely keep traders on a bearish focus through midweek. Cash 
prices are lower on the National Direct morning cash hog report. The weighted 
average price is down $0.21 at $58.66 per cwt with the range from $52 to $59.20 
on 5,866 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct 
morning cash hog report. The weighted average price fell $0.62 at $58.04 per 
cwt with the range from $57.50 to $58.50 on 1,896 head reported sold. The 
National Pork Plant Report posted 244 loads selling with carcass values falling 
$0.12 per cwt. Lean hog index for 12/08 is at $65.17 down $0.31 with a 
projected two-day index of $64.97, down $0.20.

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


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