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DTN Midday Livestock Comments          01/16 12:19

   Strong Gains Develop in Hog Trade Tuesday 

   Increased buyer support has quickly moved through the hog market, pushing 
prices to triple-digit gains. Light support is holding in the cattle trade as 
buyers focus on the ability to step back into the market following the long 
weekend. 

By Rick Kment
DTN Analyst

GENERAL COMMENTS: 

   Strong triple-digit gains are seen in hog futures which is helping to set 
the tone for higher moving market activity across the complex. This may bring 
increased trade volume to the market in all contract months through the next 
few days. Corn prices are higher in light trade. March corn futures are 3/4 
cent higher Tuesday. Stock markets are higher in light trade. The Dow Jones is 
111 points higher while Nasdaq is up 5 points.

   LIVE CATTLE:

   Narrow gains have slowly developed across the live cattle complex. The firm 
gains in the entire livestock market has helped to bring some needed stability 
to the market, although traders still remain uncertain just how much long-term 
buyer support will continue to be seen over the near futures. Cash cattle 
activity remains quiet as both sides step into the market and assess the 
upcoming needs as well as the oddity of how last week's trade developed. 
Although anything is possible, it is expected that active trade will not 
develop until later in the week and break away from the previous shift to 
early-week activity. This could help to put more focus on both beef values and 
the direction of futures trade when packers and feeders come to an agreement. 
Boxed beef cut-outs at midday are lower, $0.74 lower (select) and down $0.46 
per cwt (choice) with light movement of 57 total loads reported (28 loads of 
choice cuts, 14 loads of select cuts, 5 loads of trimmings, 10 loads of ground 
beef). 

   FEEDER CATTLE:

   Feeder cattle futures have posted light support following narrow gains in 
the entire cattle complex. The front month gains of 65 cents per cwt has helped 
to draw buyers into all contracts.  

   LEAN HOGS:

   Strong triple-digit gains have developed across the lean hog futures complex 
with nearby buying activity helping to drive additional support back into the 
market. Nearby contracts are holding gains from $1 to $1.60 per cwt as traders 
look past the recent pressure in cash markets and focus on developing increased 
buyer support. It is uncertain if any additional trade will be seen, or if 
prices will be able to move outside of the recent market range before closing 
bell. Cash prices are lower on the National Direct morning cash hog report. The 
weighted average price is down $0.34 at $69.49 per cwt with the range from 
$63.00 to $70.00 on 3,148 head reported sold. Cash prices are lower on the 
Iowa/Minnesota Direct morning cash hog report. The weighted average price is 
down $1.18 at $68.86 per cwt with the range from $64.00 to $69.50 on 680 head 
reported sold. The National Pork Plant Report posted 220 loads selling with 
carcass values adding $0.36 per cwt. Lean hog index for 1/12 is at $71.15 up 
$1.35 with a projected two-day index of $71.92, up $0.77.

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


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