DTN Before The Bell-Livestock

GENERAL COMMENTS

Mixed trade is seen early in livestock trade, with light to moderate pressure seen in most cattle futures, while lean hog futures have been able to bring some light buyer support to the market. The overall tone of the market remains weak, although light volume is limiting market direction. Corn prices are mixed in light trade. Stock markets are lower Dow Jones is 97 points lower while Nasdaq is down 30 points.

LIVE CATTLE:

Open: Mixed. Early trade in the live cattle complex is mixed to mostly lower with most contracts holding losses steady to 20 cents per cwt lower. Although the firm follow through pressure in feeder cattle markets may add some additional longer-term pressure to the complex. The focus on front-month futures trying to push early gains into the market may help to draw increased support during the month of March. Traders are focusing on both grain and livestock markets, but the main focus continues to be concerns with trade issues which may have a significant impact in export markets. These market shifts would have a longer term effect on overall beef movements and the potential to expand markets. Cash cattle activity is expected to slow to a normal Monday affair. With show list distribution and inventory taking the main order of business. Bids and asking prices are not expected to be seen until later in the week. Growing focus will also be placed on the amount of cattle sold last week in the morning sales totals. Open interest Friday lost 241 positions (376,043). Spot month April contracts lost 3,262 positions (128,525) and June contracts added 1,199 positions (131,357). DTN projected slaughter for Monday is 117,000 head.

FEEDER CATTLE:

Open: 20 to 80 cents lower. Light to moderate pressure is once again developing across the feeder cattle futures. This is adding even more weakness to the entire complex. Prices have broken through support levels of $143 per cwt during initial trade, as traders focus on underlying weak market direction through the next several trading sessions. Feeder cattle has moved more than $8 per cwt lower since early February, as traders have still been unable to stabilize the market focusing on growing supplies. Cash index for 3/1 is listed at $146.03 down 1.30. Open interest Friday fell 391 positions (56,428).

LEAN HOGS:

Open: Steady to 20 cents higher. Light buyer support is slowly developing across the complex with prices in nearby contracts holding levels of 10 to 20 cents per cwt. There is growing support through the complex that buyer activity may slowly redevelop through the week. Even though fundamentals still remain weak, the potential to spark some light activity in nearby lean hog futures could help to bring additional underlying activity to the complex. Cash hog trade Monday is expected steady. Open interest Friday liquidated 4,397 positions (227,918). Spot month April fell 4,204 in positions (78,404) and June gained 598 positions (53,778). Cash lean index for 3/1 is $68.09, down 0.27 DTN projected slaughter for Monday is expected to be 460,000 head.

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

(SK)

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