DTN Before The Bell-Livestock
Meat Futures Trade in Opening Rounds
Feedlot country is off to a typically slow start with packers primarily focusing on the collection of new showlists. We expect the early month offering to be somewhat larger than last week.
Bids and asking prices will probably be poorly defined until midweek or later. Opening cash bids range from steady to $1 lower with most efforts closer to .50-$1 lower. Corn futures are trading a nickel plus lower in the early rounds, pressured by cooler and wetter weather forecasts. The stock market is higher in the early rounds with the Dow up 74 points and the Nasdaq positive by 13.
LIVE CATTLE:
Live contracts are under pressure as the week begins thanks to recent softness in feedlot sales and worries about the possibilities of more of the same. Long term chart support should dig in between 112 and 112.50 basis August. Additionally, the premium status of cash should promote some kind of netting net. Yet commercial production is expected to build over the next 30 days or so. Open interest on Friday decreased by 2,842 (362,313). Spot August liquidated by 2,232 (45,140) and October lost 1,105 (182,329). DTN projected slaughter for today is 117,000 head.
FEEDER CATTLE:
Nearby feeder contracts are off by triple digits so far this morning. Indeed, early selling might be even more aggressive were it not for weakness in the corn market. Commercial selling and long liquidation seem to be primary forces at work here in the early rounds. Open interest on Friday decreased by 766 (60,426). CME cash feeder index for 07/27: 149.36, off 1.94.
LEAN HOGS:
Lean issues are under pressure through the opening hour with moderately losses linked to defensive fundamentals. Open interest on Friday decreased by 1,108 (268,875). Spot August liquidated by 2,370 (30,486) and October added 140 (119,027). Cash lean index 07/27: 88.75, off .64. DTN projected slaughter for today is 435,000 head.
John A. Harrington can be reached at john.harrington@dtn.com
(SK)
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