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DTN Midday Livestock Comments          06/21 11:51

   Livestock Contracts Search for Direction

   Heading into Monday afternoon, the livestock contracts aren't met with an 
overabundance of support as traders are leery. 

ShayLe Stewart
DTN Livestock Analyst


   The livestock contracts are trudging through the week's early trade as the 
market tries to gain some understanding of where prices are headed. Traders are 
especially leery of the lean hog market as a regression is well underway. July 
corn is up 8 3/4 cents per bushel and July soybean meal is up $0.50. The Dow 
Jones Industrial Average is up 498.23 points and NASDAQ is up 95.99 points.


   Live cattle futures are modestly lower as the market looks for a sense of 
direction, unsure where the week is headed at this point. There's a lot of 
business to be conducted this week for the cattle market. Wednesday there will 
be a Senate Ag Committee hearing titled, "Examining Markets, Transparency and 
Prices From Cattle Producer to Consumer." Thursday there is another big feeder 
cattle sale as Northern Livestock Video Auction hosts their Early Summer 
Special. Friday we welcome another Cattle on Feed Report. So, while the markets 
and traders try to make sense of the technical and fundamental tones of the 
marketplace, cattlemen will have plenty to manage as well with the week's busy, 
busy schedule. The weaker trade seen last week throughout the corn market 
helped encourage the live cattle market partly. But more than anything, it was 
the $2.00 to $4.00 advancement made in the cash cattle market. Packers aren't 
going to be overly keen about moving the market higher again this week after 
they gave up some margin last week. But with the cattlemen getting the 
attention of Washington, D.C., the packers won't want to cut the market 
viciously either. June live cattle are down $0.47 at $120.57, August live 
cattle are down $0.82 at $120.70 and October live cattle are down $0.75 at 

   Last week's negotiated cash cattle trade totaled 79,496 head with 78% 
(62,309 head) being committed for the nearby delivery, while the remaining 22% 
(17,187 head) were committed for the deferred delivery in the following 15 to 
30 days.

   Boxed beef prices are lower: choice down $0.89 ($322.39) and select down 
$2.24 ($281.37) with a movement of 33 loads (15.32 loads of choice, 8.09 loads 
of select, 4.60 loads of trim and 4.54 loads of ground beef).


   Breaking into Monday's trade, feeder cattle futures thought they were going 
to be able to continue last week's rally with the corn market's weaker tone. 
But as the day nears the noon hour, the market's tone isn't as favorable to 
feeders. With nearby corn prices trading mildly higher, the feeder cattle 
contracts are back to a modest regression as the live cattle market offers no 
support and traders are still trying to piece together the market signals to 
find a definitive direction. August feeders are down $0.87 at $154.15, 
September feeders are down $0.70 at $156.52 and October feeders are down $0.57 
at $158.47.


   As the market welcomes Monday, hog producers brace themselves for the week 
ahead. Looking at the market's charts, aggressive deterioration is seen all 
throughout the nearby and deferred contracts as the market refocuses its 
trajectory amid a weakening hog market in China and hit-and-miss consumer 
demand. Gauging how aggressive consumers are going to be after the Memorial Day 
weekend is always a tough mission for the retail sector. But with meat prices 
as high as they are, buyers have had even a tougher row to hoe as they want to 
offer enough choices but don't want to get stuck with overpriced product. 
Grinding through this week's trade, continuing to monitor slaughter speeds as 
it affects the cash hog market's fate and pork cutout values will be helpful in 
understanding the nearby market.

   The projected CME Lean Hog Index for 6/18/2021 is up $0.25 at $120.63 and 
the actual index for 6/17/2021 is down $1.30 at $120.38. Hog prices are higher 
on the National Direct Morning Hog Report, up $3.44 with a weighted average of 
$119.48 ranging from $113.00 to $135.00 on 4,812 head and a five-day rolling 
average of $120.13. Pork cutouts total 153.45 loads with 129.38 loads of pork 
cuts and 24.06 loads of trim. Pork cutout values: up $6.87, $127.52.

   ShayLe Stewart can be reached at

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