DTN Before The Bell-Livestock

GENERAL COMMENTS

Limited market direction is seen through the entire livestock complex This overall lack of direction in the market remains sluggish with prices mixed from 30 cents lower to 25 cents higher. Cattle and hog futures are expected to trickle into the Christmas break with limited interest. Corn markets are lower in light early trade. Stock markets are lower. Dow Jones is 351 points lower with Nasdaq down 105 points.

LIVE CATTLE:

Open: 10 to 20 cents lower. Very limited activity is expected to be seen early in the live cattle complex. With markets closing at noon due to the holiday trading session, the focus on narrow market adjustments may be the focus through the entire complex. Besides 12-cent losses in spot December contracts, the rest of the complex is holding narrow but firm losses of 20 to 25 cents per cwt. There may be only sluggish market activity developing through the rest of the morning with limited outside market direction being sought by the few still in the market. Cash cattle activity remains undeveloped with limited inventory taking and show list distribution developing. A portion of the typical early week number collection may be delayed until both sides return from the holiday break on Wednesday. Active trade is not expected until late in the week. Open interest Wednesday gained 806 positions (351,690). Spot month December contracts lost 1,152 positions (2,985) and February contracts fell 947 positions (133,260). DTN projected slaughter for Monday is 29,000 head.

FEEDER CATTLE:

Open: Mixed. Narrow price moves early Monday morning are an indication of the extremely sluggish market activity in the complex Monday. With most traders and many businesses either closed for the early week Christmas Eve holiday or closing early, the focus in the market will be pushed to midweek activity. But traditionally, the entire week between Christmas and New Year's remains lightly traded with no significant direction or trade activity seen until early January. This is likely to allow markets to hover in a narrow range, as limited pressure may continue in nearby trade. Cash index for 12/20 is listed at $145.89 up $0.15. Open interest Friday fell 553 positions (48,710).

LEAN HOGS:

Open: Mixed. With most traders already either focusing on Christmas celebrations, or possibly doing last-minute shopping, trade activity is expected to remain extremely sluggish through the next few hours. Markets will close early due to the holiday trading schedule, leaving even less activity developing across the complex. Narrow trading ranges have been seen in all lean hog trade due to very sluggish volume. This is continuing the trend from late last week as traders continue to be concerned about the ability to move active amounts of pork through the first quarter of the year. The current market is slightly oversold, and given increased volume may hold early gains Wednesday morning. Cash hog trade is steady to $1.00 lower. Most bids are steady to 50 cents lower. Open interest added 4,243 positions (200,426). February added 1855 positions (76,158) and April gained 1,730 positions (48,629). Cash lean index for 12/16 is $54.65 down 0.35. DTN projected slaughter for Monday is at 66,000 head.

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

(BAS)

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