DTN Before The Bell-Livestock

Mixed Livestock Trade Draw Buyers to the Complex

Rick Kment
By  Rick Kment , DTN Analyst
(DTN photo by Nick Scalise)
GENERAL COMMENTS

Mixed trade is seen Friday morning with very little market direction developing as traders try to focus on building stability into the market. This could bring about additional longer term buyer interest later next week. Corn futures are higher in light trade. Stock market futures are higher. Dow Jones is 38 points higher while Nasdaq is up 48 points.

LIVE CATTLE:

Open: 10 to 25 cents higher. Narrow price shifts are seen early Friday morning with light gains seen in nearby contracts. This allows for additional buyer support to develop over the end of the week, although the overall tone of the market remains under pressure given the previous market weakness in all contracts. Cash cattle markets are quiet early Friday morning as most business appears to be done for the week following trade that trickled into the market over the last few days. With sales $3 to $4 per cwt lower than last week, but generally consistent with business being done from day to day, both sides are now focusing on next week activity. Some clean up trade may develop later in the day, but the tone has been set. Open interest Thursday liquidated 5,424 positions (355,649). Spot December lost 2,471 positions (15,320) and February contracts fell 2,400 positions (145,195). DTN projected slaughter for Friday is 117,000 head.

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FEEDER CATTLE:

Open: Steady to 30 cents higher. Light buyer support is slowly trickling into the market Friday morning with narrow gains developing across nearby trade contracts. This is likely to help build some market stability at the end of the week with traders focusing on short covering following the aggressive market tumble seen over the last few days. Trade volume and market direction is expected to remain quiet through the rest of the week, although the light activity in the complex could bring about some late day volatility. Cash lean index for 12/5 is listed at $156.11, down 0.19. Open interest Thursday liquidated 843 positions (55,653).

LEAN HOGS:

Open: Mixed. Narrow to moderate trading ranges are seen across the complex with nearby futures holding firm gains as trade activity attempts to enter the market. This may spark some additional buyer support over the near future. Very little direction is likely to develop through the rest of the week as traders continue to focus on market stability heading into the weekend. Cash bids are steady to $1 per cwt lower. Most bids remain steady to 50 cents lower. Open interest Thursday fell 1,771 positions (249,247). Spot month December slipped 1,794 positions (14,807) and February lost 735 positions (100,408). Cash lean index for 12/05 is $64.85, up 0.50. DTN projected slaughter for Friday is 462,000 head. Saturday runs are seen at 221,000 head.

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

(BAS)

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Rick Kment