DTN Before The Bell-Livestock

GENERAL COMMENTS

Cattle futures remain slightly higher in light trade in order to draw buyer support back into the complex Friday morning. Cash markets remain silent at this point, although packer bids are expected to redevelop as the morning progresses. Corn markets are trading lower in light trade activity. The stock market is trading lower in light early trade. Dow Jones is 26 points lower while Nasdaq is down 10 points.

LIVE CATTLE:

Opening call: Steady to 30 cents higher. Firm gains have slowly developed during late week trade. The ability to right the ship once again has slowly brought commercial buyers back into the complex once again. Early trade remains extremely light. But the complex remains extremely sluggish with gains holding 20 cent support at this point. There remains very little momentum heading into the weekend, but with April contracts holding at $119 per cwt, a close above this level may spark additional buyer support next week. Cash cattle remain at a standstill Friday morning following just a handful of trade seen late Thursday. The light trade that was seen in Nebraska at lower money was not enough to establish a trend as it focused on dribbles and drabs and couldn't bring in enough momentum through the day even though prices were around $188 to $200 per cwt. Bids are expected to become more evident through the day, although at this point it is questions just how much activity will actually develop during the rest of the week. Asking prices remain at $128 to $130 during early morning in the South with prices at $205 in the North. Open interest Thursday added 2,481 positions (394,308). Spot April liquidated 964 positions (29,237) and June contracts gained 211 positions (184,554). DTN projected slaughter for Friday is 109,000 head.

FEEDER CATTLE:

Opening call: Steady to 40 cents higher. Follow through buyer support is moving into feeder cattle trade with narrow gains seen in all contract months. The trade volume remains light Friday morning, and is expected to remain that way through most of the trading session. August futures are holding a 37 cent per cwt gain which may keep commercial buyers slowly interested in the complex through the weekend, but focused on moving prices above the $134 per cwt price levels. Cash lean index for 4/5 is $133.21, up 0.08. Open interest Thursday added 647 position (58,118).

LEAN HOGS:

Opening call: Steady to 50 cents lower. Moderate pressure has quickly developed in nearby and deferred lean hog futures following the firm gains that developed across all livestock markets Thursday. End-of-week positions continue to draw buyer support as traders remain focused on additional morning weakness in nearby and deferred contract months. There could be additional pressure developing through not only the cash market but the concern of pork values eroding following the Easter holiday may put even more pressure on the hog complex. Cash bids are expected to be seen steady to $1 per cwt lower with most bids steady to 50 cents lower. Open interest Thursday fell 597 positions (202,173). Spot month April fell 1,808 positions (13,075) and June gained 226 positions (83,106). Cash lean index for 4/5 is $66.15, down $0.45. DTN projected slaughter for Friday is 437,000 head. Saturday runs are expected at 89,000 head.

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

(SK)

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