DTN Before The Bell-Livestock

GENERAL COMMENTS

We understand a decent number of steers and heifers sold in Nebraska yesterday at $185, about $2 lower than last week.

Feedlot country is generally quiet in the early rounds today with just a few $115 bids noted in the South. Some showlists have been priced around $118 plus in the South and $188-190 in the North. The FCE has receipts today close to 1,600 head, somewhat larger than last week, but not by a great deal. We'll post that internet business on the cash cattle page ASAP later this morning. Light to moderate trade volume could surface by the end of the day. Hog buyers are out this morning with bids ranging from steady to .50 lower. Corn futures are fractionally higher in the early going as traders slowly position ahead of tomorrow's WASDE report. The stock market is lower this morning with the Dow down by 60 points and the Nasdaq off 45.

LIVE CATTLE:

Triple-digit losses (i.e., off 125 to 157) dominate live futures this morning with further selling and long liquidation at least partially to the tension surround North Korea. Nearby contracts have taken out last week's lows and are now probing price territory not seen since late April. The board acts as if it's found a new determination to lead cash lower. Open interest on Tuesday decreased by 6,072 (326,447). Spot August liquidated by 2,309 (16,941) and October lost 3,128 (169,634). DTN projected slaughter for today is 120,000 head.

FEEDER CATTLE:

Feeders have also stumbled into midday with significant losses Prices are currently off by as much as 202 to 262. Needless to say, as prospective feedlot margins tighter, commercial buying here fades. Open interest on Tuesday increased by 197 (61,064). CME cash feeder index for 08/07: 149.37, off .40.

LEAN HOGS:

Lean hog issues appear to be successfully ignoring bearish woes in the cattle complex—at least for the moment. Prices are no worse than mixed at this time with the front half of the board showing moderate gains. While discounts remain sobering, we are seeing a new conviction that they have become somewhat too excessive. Open interest on Tuesday increased by 2,010 (264,020). Spot August liquidated by 906 (14,900) and October grew by 270 (118,754). Cash lean index 08/07: 85.76, off .34. DTN projected slaughter for today is 445,000 head. The Saturday kill could be as large as 131,000 head.

John A. Harrington can be reached at john.harrington@dtn.com

(SK)

Copyright 2017 DTN/The Progressive Farmer. All rights reserved.