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DTN Closing Livestock Comment 02/21 16:39
Hog Futures Rally on Trade Hopes
Renewed hopes for a trade deal with China that could include significant
U.S. pork exports boosted hog futures Thursday. Cattle markets remained
sluggish with most traders watching from afar most of the session.
By Rick Kment
GENERAL COMMENTS: Lean hog futures quickly and aggressively led the
livestock market higher as traders focused on short-covering following early
week pressure as well as hopes that exports will improve on a China trade deal.
Cattle markets were mixed in limited activity. Cash cattle markets were quiet
Thursday with both sides apparently waiting until Friday. This added some
additional apprehension, as trade may be delayed until after Friday's Cattle on
Feed report. Bids have remained at $123 live and $198 dressed, still below
asking prices of $128 live and $205 to $207 dressed. The National Daily Direct
afternoon hog report was $1.53 lower ($44-$47.85, weighted average $46.37) on
6,233 head sold. Corn futures were higher in light activity with the March up 4
cents per bushel. The Dow Jones Index was 101 points lower with the Nasdaq down
No daily commentary available
March beans finished up 8 ½ , March corn up 4 ¾ , and March wheat up 5 ¾. News today about the Chinese pledging to buy large quantities of Ag products including corn and wheat rallied the markets. Beans were able to get back above the major moving averages before settling just below the 50 DMA at 911 ½. Corn found resistance at the 50 DMA but was able to settle above short term 10 day moving average. The market is getting excited about the possible trade deal and that there are some specific things being addressed. The two groups are working on a memorandum or understanding for a trade agreement (written agreement). As always, devil is in the details, exactly what, how much, and when is still up for debate. Initial numbers getting thrown around were that China would buy an additional $30B of US ag products. USDA released estimates for corn acres in 2019 to be 92M, Beans at 85M and wheat at 47M with no big surprises.