DTN Before The Bell-Livestock

GENERAL COMMENTS

December cattle are steady and hogs are lower early Thursday with traders waiting for cash cattle sales to develop. December hog prices are falling back from well-known resistance, but both beef and pork showed active export sales for last week.

LIVE CATTLE:

Open: 12 cents higher. December cattle are roughly steady, still finding support in their sideways range with assistance from this week's higher boxed beef prices, a modestly higher start in the stock market and a bullish weekly export sales report. USDA said 25,300 metric tons (mt) of beef were sold last week with Hong Kong listed as the top buyer. Cash cattle are expected to be steady to $2 higher early Thursday with some cash business possible later in the day. Total open interest increased 3,736 to 348,501 on Wednesday's mixed trade. December contracts increased 1,022 to 123,392 and February increased 1,772 to 91,465. Dow Jones projected cattle slaughter for Thursday at 118,000 head, down from 119,581 a year ago.

FEEDER CATTLE:

Open: 10 cents higher. January feeder cattle are up $0.42 early, still holding above support at $148.00 while beef demand is active and corn prices are not doing much, trading up a cent early Thursday. As they have all year, cattle and feeder prices continue to benefit from increased beef demand and a bullish outlook for the economy. The Feeder Cash index for 10/30 is listed at $154.13, down $0.80 from a week ago. Total open interest increased 103 to 49,035 on Wednesday's higher trade.

LEAN HOGS:

Open: 62 cents lower. December hogs are down $0.95 early Thursday, falling back from well-known resistance at $60.00. Pork carcass prices dipped lower Wednesday, but are holding up fairly well in the face of hogs' higher recent slaughter pace. The October low near $51.00 should offer support with ongoing concern about African swine fever in China. USDA reported 21,800 mt of pork export sales for last week, a bullish amount, thanks to Mexico. The Lean Hog Index for 10/30 was estimated at $63.90 down $1.56 from a week ago. Cash hog trade is expected to be steady to $1 lower early Thursday. Total open interest dropped 909 to 225,040 on Wednesday's lower trade. Open interest in the December contract fell 3,419 to 90,727 while February contracts increased 1,497 to 47,108. Dow Jones projected hog slaughter for Thursday at 477,000 head, up from 457,869 a year ago.

Todd Hultman can be reached at Todd.Hultman@dtn.com

Follow him on Twitter @ToddHultman

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