DTN Before The Bell-Livestock

Mixed Trade Developing Friday Morning

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

Livestock markets remain mixed in sluggish trade. The overall lack of direction in most contracts points to the fact that most needed positions were adjusted Thursday before the end of the month. This could limit additional activity through the coming week. Corn prices are higher in light trade. Stock markets are mixed, Dow Jones is 222 points higher while Nasdaq is up 69 points.

LIVE CATTLE:

Open: Mixed. Trade activity and interest remains undeveloped across the complex with traders looking for increased overall support through the market at the end of the week. Moderate gains are seen in June and August contracts with overall support likely to be hard to find in most contracts through the end of the session. Deferred futures are holding light to moderate pressure, although concerns surrounding the overall lack of interest could keep prices volatile through the upcoming week. Cash cattle activity has moved into the home stretch with very limited trade seen so far this week. With month end, seen at the end of the day Thursday, packers are expected to be more focused on longer-term market direction over the next few hours. Bids are expected to steadily increase through the day although active trade may not be seen until sometime this afternoon. Open interest Thursday fell 701 positions (345,105). Spot month June contracts lost 3,277 positions (33,146) and August contracts added 1,371 positions (165,786). DTN projected slaughter for Friday is 116,000 head.

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FEEDER CATTLE:

Open: Mixed. Narrow trading ranges are seen Friday following the wide price shifts over the last couple of sessions. Most contracts are contained from 10 cents lower to 10 cents higher in early trade with the expectation that overall trade will remain sluggish over the near future. Cash index for 5/30 is listed at $134.82 down 0.04. Open interest Thursday liquidated 632 positions (43,053).

LEAN HOGS:

Open: Mixed. Light activity is seen in the complex with very limited movement in any contract months. Light gains are holding in front month June futures while the rest of the complex is under pressure. The most significant losses of 40 to 50 cents per cwt are seen through late year contracts with concerns of demand sluggishness developing in the complex. Cash hog trade Friday is 50 cents to $1.50 higher per cwt. Most bids are seen $1 higher. Open interest Thursday fell 441 positions (238,522). Spot month June fell 1,655 positions (21,179) and July fell 2,040 positions (73,116). Cash lean index for 5/30 is $69.63, up 0.13. DTN projected slaughter for Friday is expected to be 454,000 head. Saturday runs are estimated at 227,000 head.

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

(SK)

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Rick Kment