DTN Before The Bell-Livestock

GENERAL COMMENTS

Narrow trading ranges have been seen across all livestock futures trade early Tuesday morning. The volatility which developed Monday has created some increased market apathy in all markets as traders seem to be not only focusing on the direction of fundamental market moves, but potential outside shifts which could develop later through the session. Corn futures are steady in light trade. Stock market futures remain higher. Dow Jones is 165 points higher while Nasdaq is up 2 points.

LIVE CATTLE:

Open: Steady to 10 cents higher. Narrow gains have slowly trickled into the live cattle futures complex. This continues to draw buyer support back to the entire cattle market, but the overall lack of support in the market remains unable to spark widespread interest or activity levels through the complex. This will likely leave prices stuck in a narrow trading range over the near future. Cash cattle markets remain at a standstill following the sluggish Monday distribution of show lists. Asking prices are still undeveloped in most areas and may remain that way through most of the day. It is not expected that bids will be evident through the day and well into Wednesday, as most trade will likely be pushed off until the last half of the week. Open interest Monday gained 2,367 positions (330,547). Spot October lost 1,169 positions (3,103) and December contracts slipped 1,175 positions (140,803). DTN projected slaughter for Tuesday is 118,000 head.

FEEDER CATTLE:

Open: Mixed. The initial market push higher was quickly offset by narrowly mixed trade in all feeder cattle futures as trade volume remains extremely sluggish once the first flurry of activity has cleared the complex. This has allowed prices to hold from 10 cents lower to 15 cents per cwt higher as traders are looking for some underlying fundamental support to redevelop once again in the live cattle markets through the week. But for now, traders remain uncertain as to just how much additional buyer interest will be seen through the rest of the morning. Cash lean index for 10/20 is $154.69, down 0.10. Open interest Monday added 659 position (62,104).

LEAN HOGS:

Open: Mixed. Narrow trading ranges have redeveloped through the lean hog futures complex as traders continue to focus on sluggish moves early in the week through the cash hog trade. This limited price movement and light volume through the early minutes of trade will likely keep markets subdued through most of the morning. Cash bids are called 50 cents lower to 50 cents higher per cwt higher with most bids steady. Open interest Monday added 1,612 positions (250,523). Spot month December slipped 679 positions (115,782) and February added 658 positions (49,388). Cash lean index for 10/20 is $65.23, up 1.02. DTN projected slaughter for Tuesday is 465,000 head. Saturday runs are expected for 201,000 head.

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

(SK)

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