DTN Before The Bell-Livestock

GENERAL COMMENTS

Narrow trading ranges have held through the entire complex. This is leaving traders focusing on the potential moves in market fundamentals, while closely monitoring changes in outside market. Corn markets are steady in light early trade. Stock markets are higher. Dow Jones is 116 points higher with Nasdaq up 28 points.

LIVE CATTLE:

Open: Steady to 30 cents higher. Light buyer support is slowly moving into the live cattle complex with limited interest starting to develop as April contracts are attempting to build support near $128 per cwt. This underlying support may continue to bring buyer activity to the table, but the upside of the market is expected to be limited over the next few trading sessions. Cash cattle activity remains undeveloped with bids and asking prices still unavailable. It is expected that trade will be pushed off until late in the week, as interest may not develop until Wednesday or later. Open interest Monday added 4,884 positions (440,878). Spot month April contracts lost 8,165 positions (73,708) and June contracts added 9,089 positions (192,275). DTN projected slaughter for Tuesday is 117,000 head.

FEEDER CATTLE:

Open: Steady to 20 cents higher. Limited interest is seen through feeder cattle trade with very limited movement in all nearby contracts months. The focus on steady gains of 10 to 20 cents in all spring and summer contracts is helping to add some much needed stability to the market. But the inability to spark significant trade volume is causing additional concerns that many traders are hovering on the sidelines, waiting for the next big break to develop. This could add some additional volatility through the entire cattle complex which has remained well contained within current ranges. Cash index for 3/14 is $137.65 down $0.74. Open interest Monday fell 284 positions (52,196).

LEAN HOGS:

Open: Mixed. Narrow trading ranges have trickled into lean hog futures early Tuesday morning with increased buyer support seen in front-month April contracts. But with traders only able to post a 10 cent gain in front month futures, the limited activity is focusing on taking profits in other nearby futures based on the recent market surges. Even though fundamental support is rebuilding in the hog complex, the speed and aggressiveness of market support over the last week is leaving the complex ripe for a market retraction. This could keep prices hovering in a narrow range through most of the morning. Cash hog trade is steady to $2 higher. Most bids are $1 higher. Open interest fell 2,166 positions (274,427). April fell 2,955 positions (36,546) and June slipped 971 positions (83,133). Cash lean index for 3/15 is $56.54 up $1.14. DTN projected slaughter for Tuesday is 465,000 head. Saturday runs are expected near 165,000 head.

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

(BAS)

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