Live and feeder cattle futures plunge again with fear-based selling on new HPAI news says Scott Varilek, Kooima Kooima Varilek.
Yesterday, USDA announced a federal order will go into effect April 29 restricting movement of lactating dairy cattle interstate unless cattle test negative for Influenza A. This comes after a commercial milk sample showed fragments of the virus. However, those fragments were not live and create no risk for the public.
In addition, Columbia is banning beef from the 8 affected states.
However, Varilek says cash is holding together on fed cattle. “We had steady cash trade at $182 in the South on Wednesday and cash feeders are still red hot.”
So, will cattle futures hold the recent lows? That is the big test according to Varilek and the hope is cooler heads will prevail and the market will rebound as it goes back to trading its own fundamentals including the tight supplies indicated in the Cattle on Feed Report.
Hogs are following cattle lower but also ran up into chart resistance says Varilek. However, packers are still looking for hogs which is an indication of continued strong demand.
Corn is higher in tandem with wheat and with strong weekly exports, but can it take out overhead chart resistance at the top of the recent trading range?
Varilek says he’s not confident about it and has been using the rally to clean up old crop sales of corn.
He says soybeans see early pressure on increased farmer selling and poor weekly exports.
