DTN Before The Bell-Livestock

GENERAL COMMENTS

Moderate pressure is expected to continue to drive additional weakness into cattle and hog futures. This may bring additional uncertainty to the market, although trading volume is expected to remain light with little additional long-term focus developing early in the week. Corn futures are lower in light trade. Stock market futures are lower. Dow Jones is 11 points lower while Nasdaq is down 3 points.

LIVE CATTLE:

Open: 50 cents to $1 lower.

Light to moderate pressure is slowly developing across the cattle complex with little direction early in the week in live cattle markets. The moderate spread between December and February futures contracts continues to limit overall market direction but could keep buyers on the sidelines for most of the trading day. Cash cattle activity remains quiet with the focus on showlist distribution and inventory taking once again. This may continue to limit overall market activity through most of the day. Open interest Friday lost 334 positions (382,717). Spot December lost 12,603 positions (81,249) and February contracts added 8,343 positions (139,407). DTN projected slaughter for Friday is 118,000 head.

FEEDER CATTLE:

Open: $1 to $2 Lower.

Moderate to firm pressure is developing through feeder cattle contracts with traders focusing with little additional market direction developing across the complex. This could add additional market weakness through most of the session as traders look for increased market pressure to redevelop in live cattle trade. Cash lean index for 11/1 is $158.71, up 1.35. Open interest Friday fell 222 position (63,718).

LEAN HOGS:

Open: Mixed.

Sluggish trade is developing early Monday morning through lean hog futures trade with little outside market direction impacting the overall hog complex early in the week. Moderate pressure in cattle futures are likely to have additional bearish pull for hog trade through most of the morning. Cash bids are called steady to $1 lower with most bids 50 cents to $1 lower. Open interest Friday fell 124 positions (266,490). Spot month December slipped 8,037 positions (64,247) and February added 5,396 positions (86,371). Cash lean index for 11/1 is $69.42, up 0.12. DTN projected slaughter for Monday is 465,000 head.

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

(BAS)

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