DTN Before The Bell-Livestock

GENERAL COMMENTS

Cattle country is at a standstill this morning and opinions vary regarding the necessity to do more business before the weekend break. Our guess is that the South is essentially done, but the North could put up a few more numbers. Unsold steers and heifers appeared to be priced around $118 in the South and $185 plus in the North. Hog buyers have resumed work with bids ranging from steady to 0.50 higher (mostly steady). Corn futures are popping higher in the early going with 2018 contracts 5-6 cents higher. There are supportive rumors floating around about a new deal with China that could trigger more bean business in that direction. The stock market is mixed as of this writing with the Dow up 6 points and the Nasdaq neagative by 21.

LIVE CATTLE:

Live contracts are moderately higher in early business with prices generally 25 to 57 in the green. Follow-through short covering, the correction of oversold charts, and late week profit taking seem to be the initial sources of price strength. Open interest on Thursday increased by 595 (360,369). Spot June liquidated by 3,743 (64,917) and August jumped by 2,561 (157,841). DTN projected slaughter for today is 118,000 head. The Saturday kill is expected to be close to 55,000.

FEEDER CATTLE:

Feeder issues are mostly higher at this time, though spot May and ther far deferreds are somewhat draggier. Needless to say, feeder fortune will continued to be lined to action in the live (unless a sustained corn rally really becomes a viable consideration). Open interest on Thursday increased by 63 (46,892). CME cash feeder index for 05/16: 134.83, off 0.84.

LEAN HOGS:

Lean hog futures are mixed in early business with prices ranging from 35 higher to 25 lower. Traders of summer contracts seem cautious regarding their premiums to cash. They may be in a holding pattern through the day, waiting for better evidence of cash potential through the balance of May and into June. Open interest on Thursday decreased by 3,149 (238,852). Spot June liquidated by 7,765 (42,579) and July increased by 3,690 (69,543). Cash lean index 05/16: 67.01, up 0.87. DTN projected slaughter for today is 438 head. At this point, the Saturday kill looks around 87,000.

John A. Harrington can be reached at john.harrington@dtn.com

(SK)

Copyright 2018 DTN/The Progressive Farmer. All rights reserved.