DTN Before The Bell-Livestock

GENERAL COMMENTS

LIVE CATTLE:

Open: Mixed. Early trade is mixed to mostly lower Friday morning, although most contracts are holding losses from 10 to 25 cents per cwt. This is a significant shift from the aggressive market moves seen through the week as trades seem to be looking for a sense of market stability. This could keep prices in a narrow trading range with very limited additional direction seen through the complex. Cash cattle bids are improving Friday morning with live bids seen at $114 per cwt. This is still a wide gap from asking prices at $120 live and $190 dressed. Trade may not be seen until late in the afternoon Friday. Open interest Thursday added 1,644 positions (337,441). Spot month December contracts lost 2,111 positions (20,305) and February contracts gained 1,005 positions (138,489). DTN projected slaughter for Friday is 117,000 head.

FEEDER CATTLE:

Open: Mixed. Trade has returned back to a sluggish rumble Friday morning as traders seem to have moved on from the aggressive triple-digit losses seen Thursday and a sense of market calmness is seen at this point. It is uncertain just how much additional direction will develop over the near future, but light gains in nearby contracts have helped to spark some underlying support across the entire market. Cash index for 12/05 is listed at $145.53 down $0.85. Open interest Thursday fell 393 positions (49,312).

LEAN HOGS:

Open: 30 to 70 cents higher. Renewed buyer support has moved back into the lean hog futures trade. This has helped to spark some additional underlying activity through the complex with February futures leading the buying activity as prices have moved 70 cents higher in initial trade. The focus on outside market direction and the political uncertainty between the U.S. and China will continue to be the focus through the end of the week. Cash hog trade Friday is steady to $1.00 lower. Most bids are steady to weak. Open interest lost 3,426 positions (212,048). Spot month December fell 2,941 positions (18,325) and February slipped 449 positions (77,795). Cash lean index for 12/05 is $56.19 up 0.21. DTN projected slaughter for Friday is at 473,000 head. Saturday runs are expected at 192,000 head.

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

(BAS)

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