DTN Before The Bell-Livestock

GENERAL COMMENTS

Moderate to firm support is seen in all livestock futures with traders focusing on the ability to cover short positions in the hog market while follow-through buying is stepping back into the cattle complex. Light trade is expected to be seen in all markets due to the holiday weekend. Corn futures are higher in light trade. Stock market futures are mixed. Dow Jones is 15 points lower while Nasdaq is up 2 points.

LIVE CATTLE:

Open: 40 to 90 cents higher. Strong gains have quickly moved into live cattle futures complex following the buyer interest that quickly developed Tuesday. Follow through support is likely to be seen through the morning although the light volume expected surrounding the Thanksgiving holiday will likely keep overall market volatility limited. Cash cattle activity remains quiet early Wednesday morning following light to moderate trade that developed Tuesday. Prices were generally steady to $1 per cwt lower with live business seen at $118 per cwt, while dressed trade developed from $118 to $120 per cwt. Although there could be some additional trade developing Wednesday, especially in the North. The tone of the market is likely to have been set as both sides head to the holiday weekend. Open interest Tuesday liquidated 834 positions (380,880). Spot December lost 5,787 positions (46,135) and February contracts added 818 positions (156,447). DTN projected slaughter for Wednesday is 117,000 head.

FEEDER CATTLE:

Open: 70 to 90 cents higher. Triple-digit gains that developed in cattle markets late Tuesday has sparked additional buyer support back through the complex. This may bring additional longer-term support back to the market, although traders still are focusing on the market pressure that developed early in November. Very light trade is expected to keep markets sluggish through most of the morning as most traders are heading for the long weekend. Cash lean index for 11/20 is listed at $156.71, down 0.20. Open interest Tuesday lost 2,318 position (56,497).

LEAN HOGS:

Open: Steady to 50 cents higher. Firm market support is slowly developing in lean hog futures trade early Wednesday morning. Trade volume in all markets remains sluggish and is expected to remain that way through the end of the week. With markets closed Thursday due to Thanksgiving, it is expected that many traders will remain either on the sidelines or totally absent as they extend the holiday weekend. December futures are 43 cents higher in early trade based on short covering, while narrow gains are seen in other nearby contracts. Cash bids are called steady to $1 lower most bids are expected 50 cents lower. Open interest Tuesday lost 2,168 positions (249,335). Spot month December slipped 1,922 positions (37,603) and February fell 136 positions (93,030). Cash lean index for 11/20 is $64.41, down 0.42. DTN projected slaughter for Wednesday is 463,000 head. Saturday runs are expected to be near 346,000 head.

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

(BAS)

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