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DTN Midday Livestock Comments          02/27 12:09

   Livestock Contracts Dive Lower -- Again 

   The coronavirus has worked its way into the heart of the market and is 
causing nasty problems with livestock contracts. 

By ShayLe Stewart
DTN Livestock Analyst

General Comments

   The back and forth nature of this week's trade really emphasizes the stark 
reality of when emotion rules the marketplace. One day markets crash lower, the 
next day their losses are only minimal, then the market begins to trade higher, 
but then dives lower again. The back and forth uncertainty pushes traders away 
as the marketplace is too volatile and it suppresses prices in the cash market 
as both markets are emotionally tied. We know that markets as vulnerable as the 
people that trade within their reach, but unprecedented volatility creates a 
lot of distrust which takes a long time to come back around. May corn is down 7 
cents per bushel and May soybean meal is up $3.40. The Dow Jones Industrial 
Average is down 394.96 points and NASDAQ is down 152.51 points. 

   LIVE CATTLE 

   Live cattle contracts haven't been able to escape from Thursday's pressure 
and are trading fully lower. April live cattle are down $1.60 at $110.80, June 
live cattle are down $1.00 at $104.02 and August live cattle are down $0.57 at 
$104.40. Cash cattle trade seems to more or less done for the week as Thursday 
morning has been quiet from both packers and feeders. Asking prices for cattle 
that are still available are $117-plus in the South and $187-plus in the North. 

   Boxed beef prices are mixed: choice down $0.50 ($205.84) and select up $1.24 
($199.84) with a movement of 101 loads (77.45 loads of choice, 11.67 loads of 
select, 0 loads of trim and 12.06 loads of ground beef). 

   FEEDER CATTLE 

   Feeder cattle contracts are trading with some triple-digit losses in nearby 
contracts as noon approaches. March feeders are down $3.15 at $130.92, April 
feeders are down $3.72 at $132.25 and May feeders are down $3.22 at $ 133.65. 
At this point, the back and forth ambiguity of the coronavirus scare has the 
marketplace in utter turmoil. 

   LEAN HOGS 

   Over the last couple of days the lean hog market has been able to manage 
some damage control with help from a strong cash market. Thursday morning cash 
hog prices are higher but the lean hog future's contracts aren't able to let 
cattle contracts take all of the heat this time around. April lean hogs are 
down $1.97 at $63.17, June lean hogs are down $1.92 at $78.47 and July lean 
hogs are down $1.95 at $79.65. 

   The projected lean hog index for 2/26/2020 is down $0.05 at $56.36, and the 
actual index for 2/25/2020 is up $0.25 at $56.41. Hog prices are higher on the 
National Direct Morning Hog Report, up $0.15 with a weighted average of $50.17, 
ranging from $45.00 to $52.00 on 7,040 head with a five-day rolling average of 
$50.07. Pork cutouts total 194.84 loads with 174.04 loads of pork cuts and 
20.80 loads of trim. Pork cutout values: up $1.94, $66.43. 

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


(CZ)

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