DTN Before The Bell-Livestock

Gains Seen Early in Cattle Trade

Rick Kment
By  Rick Kment , DTN Analyst
(DTN photo by Nick Scalise)
GENERAL COMMENTS

Firm gains have redeveloped through the cattle market, although limited trade is seen in the lean hog complex. There is likely to be increased market volume moving into the cattle market through the session. Corn prices are mixed in light trade. Stock market futures are higher, Dow Jones is 26 points lower while Nasdaq is down 12 points.

LIVE CATTLE:

Open: 50 cents to $1 higher. Follow-through support may continue to draw increased activity through the complex. There is growing support over the near future as traders will continue to spark some increased overall movement across the complex. Front month futures are leading the market higher with 70 cent gains. Cash cattle markets are quiet early Thursday morning with bids undeveloped at this point. It is likely that active trade may be delayed until Friday, although packer interest is expected to improve through the day. Asking prices are seen at $124 live and $195 and higher dressed at this point. Open interest Wednesday fell 3,853 positions (349,512). Spot February lost 9,531 positions (61,763) and April contracts gained 2,775 positions (141,541). DTN projected slaughter for Thursday is 118,000 head.

P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]

FEEDER CATTLE:

Open: Steady to $1 higher. Moderate support quickly developed through the market as traders focused on increased buyer activity in all cattle markets. The renewed activity is likely to draw additional longer term support back into the market, although trade volume may remain sluggish. Cash lean index for 1/16 is listed at $119.39, down 0.02. Open interest Wednesday added 281 positions (52,681).

LEAN HOGS:

Open: Steady to 20 cents lower. Light losses have slowly developed through the most contracts posting 10 to 20 cents lower. There is very little activity developing across the market as traders focus on the ability to bring stability to cash and pork markets over the near future. Cash bids are steady to $1 lower. The support in cattle markets may allow for increased buyer activity to move into hog trade through the near future. Bids are scattered through the range. Open interest Wednesday added 404 positions (245,524). Spot month February fell 3,550 positions (37,683) and April added 2,074 positions (99,489). Cash lean index for 1/16 is $72.99, up 1.07. DTN projected slaughter for Thursday is expected to be 465,000 head. Saturday runs are expected to be seen near 148,000 head.

Rick Kment can be reached at rick.kment@dtn.com

(SK)

P[L2] D[728x90] M[320x50] OOP[F] ADUNIT[] T[]
P[R1] D[300x250] M[300x250] OOP[F] ADUNIT[] T[]
P[R2] D[300x250] M[320x50] OOP[F] ADUNIT[] T[]
DIM[1x3] LBL[] SEL[] IDX[] TMPL[standalone] T[]
P[R3] D[300x250] M[0x0] OOP[F] ADUNIT[] T[]

Rick Kment