DTN Before The Bell-Livestock

GENERAL COMMENTS

Mixed trade continues across the entire livestock market as traders continue to focus on additional longer-term market direction. The overall lack of support in the complex continues to be focused on increased trade volume and the ability to draw buyers back to the table through the holidays. Corn futures are higher in light trade. Stock market futures are lower. Dow Jones is 35 points lower while Nasdaq is down 16 points.

LIVE CATTLE:

Open: Steady to 60 cents higher.

Light buyer support is slowly but firmly stepping into the live cattle complex. This is helping to draw additional market support back into the entire complex. A couple of contracts are holding single-digit losses in early trade Tuesday, but the focus on drawing commercial traders back to the complex is helping to spark some increased buyer interest. Cash cattle markets remain quiet early Tuesday with bids and asking prices still hard to define. It is expected that more packer interest will develop midweek, which may push active trade off until later in the week. Open interest Monday gained 362 positions (335,257). Spot December lost 1,056 positions (6,552) and February contracts fell 920 positions (127,904). DTN projected slaughter for Tuesday is 118,000 head.

FEEDER CATTLE:

Open: Mixed.

Narrow trading ranges are seen early Tuesday morning and light buyer support in nearby contracts. This is being offset by pressure in the deferred market as traders continue to focus on additional longer-term market shifts through the end of the year. The current market support seen last week is helping to bring some needed stability back into the market as traders rally back from short-term lows seen during late November. Cash lean index for 12/14 is listed at $154.40, up 0.09. Open interest Monday added 411 positions (54,281).

LEAN HOGS:

Open: Mixed.

Early trade remains light with a mixture of buying and selling activity moving into the market following the overall lack of direction in the complex. This may bring additional volume later in the day, although traders are expected to start slowing down ahead of the holiday weekend. Activity through the end of the year is expected to remain sluggish with traders focusing on additional market direction in outside markets while many traders stay on the sidelines. Cash bids are steady to $1 per cwt lower. Most bids are 50 cents lower. Open interest Monday lost 3,084 positions (236,753). Spot month December fell 2,317 positions (7,699) and February fell 1,550 positions (91,206). Cash lean index for 12/15 is $63.18, down 0.93. DTN projected slaughter for Tuesday is 465,000 head.

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

(BAS)

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