DTN Before The Bell-Livestock

GENERAL COMMENTS

Strong gains are seen in lean hog trade with buyers focusing on the inability to spark additional long-term support. Cattle markets are lightly traded with very limited direction seen across either market. Corn prices are higher in light trade. Stock market futures are higher, Dow Jones is 24 points higher while Nasdaq is up 34 points.

LIVE CATTLE:

Open: Mixed. Very little additional direction is seen early Wednesday. The focus on cash market activity over the near future is likely to be seen as the ability to bring some increased direction to the market. But trade is likely to remain sluggish through most of the morning. Cash cattle markets are still sluggish with bids undeveloped through the morning. The few cattle that traded in Kansas Tuesday are not likely to add even more direction to the market. It still may be the end of the week before active trade develops. Open interest Wednesday added 3,557 positions (357,076). Spot February lost 1,527 positions (47,939) and April contracts gained 447 positions (145,830). DTN projected slaughter for Wednesday is 118,000 head.

FEEDER CATTLE:

Open: Mixed. Limited trade activity is seen in feeder cattle markets following the recent support over the last couple of days. There is likely to be some additional market direction seen through the end of the week, although fundamental moves may have a bigger impact on the overall complex. Cash lean index for 1/18 is listed at $148.01, up 1.53. Open interest Tuesday added 282 positions (53,822).

LEAN HOGS:

Open: 30 to 70 cents higher. Firm gains have developed in lean hog trade with gains in nearby contracts holding 60 to 70 cent gains. The overall buyer interest in the market remains light, but the ability to move prices above the recent losses is helping to spark some additional interest. Cash hog trade Tuesday is expected to steady to 50 cents lower. Most bids are expected to be steady. Open interest Tuesday fell 165 positions (247,350). Spot month February fell 2,583 positions (26,177) and April added 581 positions (106,283). Cash lean index for 1/19 is $73.40, down 0.27. DTN projected slaughter for Wednesday is expected to be 462,000 head. Saturday runs are expected to hit 137,000 head.

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

(SK)

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