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DTN Midday Livestock Comments          02/24 12:14

   New Headlines and the Market Panics  

   Livestock contracts drop lower Monday morning. 

By ShayLe Stewart
DTN Livestock Analyst

General Comments

   As market analysts, it's our job to provide our readers the most current and 
up-to-date information available. Knowing that markets are largely influenced 
by external factors, watching the cattle market isn't as simple as staying up 
to date with live cattle and feeder cattle trade. But just as fast as new 
headlines storm through the marketplace, their relevance can diminish just as 
fast as it came. It's important to know what happening in the market; Monday 
morning for example, has been largely influenced by the coronavirus spreading 
into South Korea and Japan, and Brazil again exporting fresh beef into the 
United States. Sometimes there is a misunderstanding with headlines. Not every 
bit of data shared is meant to affect the market. It's important to understand 
what's happening to economies that the U.S. depends on for healthy trade, and 
understand what's changed from day to day, but the market shouldn't break in 
two every time there is an announcement of something new. It's important that 
we all educate ourselves on the matters at hand, and make sound, unemotional 
decisions when it comes to trade and finances.  

   March corn is down 6 cents per bushel and May soybean meal is down $2.30. 
The Dow Jones Industrial Average is down 947.90 points and NASDAQ is down 
351.86 points. 


   Live cattle contracts haven't neglected to jump on board and trade lower at 
the start of the new week. February live cattle are down $2.50 at $117.22, 
April live cattle are down $3.00 at $115.25 and June live cattle are down $2.95 
at $107.32. The weakness that has penetrated the livestock sector comes from 
the announcement that the coronavirus has spread into both Japan and South 
Korea -- two large export countries for US beef -- and that Brazil will be 
exporting fresh beef once again into the U.S. Cash cattle business is quiet as 
usual on Monday as asking prices have yet to be established and packers are 
working the country quiet yet. 

   Boxed beef prices are mixed: choice up $1.60 ($206.69) and select down $0.50 
($201.20) with a slim movement of 47 loads (25.59 loads of choice, 5.15 loads 
of select, 6.17 loads of trim and 9.59 loads of ground beef). 


   Near-limit losses seems to be only option in the feeder cattle market as the 
day washes out and support seems to be long gone. March feeders are down $4.25 
at $135.95, April feeders are down $4.50 at $137.60 and May feeders are down 
$4.50 at $138.35. The weakness that is affecting the feeder cattle market is no 
different from the other contracts - the announcement of the coronavirus 
spreading into Japan and South Korea has the entire livestock sector nervous. 


   Knowing that the day is going to be largely spent trading lower, in the 
midst of the downward pressure, the lean hog complex is taking the slimmest 
hit. April lean hogs are down $2.17 at $64.85, June lean hogs are down $1.90 at 
$79.95 and July lean hogs are down $1.50 at $81.22. It's once again positive 
for the future's market to have positive cash hog trade which aids as something 
substantial and reliable for the market to fall back on in morning of 
emotionally stimulated trading. 

   The projected lean hog index for 2/21/2020 is up $0.04 at $55.91, and the 
actual index for 2/20/2020 is up $0.09 at $55.87. Hog prices on the National 
Direct Morning Hog Report at $0.80 higher with a weighted average of $50.55, 
ranging from $45.00 to $52.50 on 3,366 head sold and five-day rolling average 
of $49.96. Pork cutouts total 136.45 loads with 125.57 loads of pork cuts and 
10.88 loads of trim. Pork cutout values: up $1.13, $66.13. 

   ShayLe Stewart can be reached 


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