DTN Before The Bell-Livestock

GENERAL COMMENTS

Moderate trade volume is seen early Tuesday with livestock futures mostly lower in sluggish early trade. This may add some additional market shifts through the trading session. Corn markets are lower in light early trade. Stock markets are higher. Dow Jones is 285 points higher with Nasdaq up 95 points.

LIVE CATTLE:

Open: Steady to 70 cents lower. Sluggish market activity is seen through the entire complex with April futures holding a 10-to-20-cent loss through initial trade. The sharp triple digit losses seen across the complex has allowed for increased momentum through the entire market with traders focusing on increased follow through liquidation. Nearby contracts still are trading $1 per cwt above short-term lows set in the last couple of weeks, allowing markets to hover within the sideways trading range over the near future. There may be some additional underlying support developing through the end of March, but concerns of eroding beef values has caused some additional softness through the complex. Cash cattle markets remain at a standstill with bids and asking prices still undeveloped in all areas. It is expected that trade will be pushed to the last half of the week once again with bids not likely until Wednesday or later. Open interest Monday added 3,306 positions (451,443). Spot month April contracts lost 4,323 positions (56,397) and June contracts added 15 positions (204,626). DTN projected slaughter for Tuesday is 118,000 head.

FEEDER CATTLE:

Open: Mixed. Moderate trade ranges have contained initial trade from 60 cents lower to 57 cents higher. March futures remain lightly traded and have found some underlying support although the actively traded April contract is holding a 20-cent loss with limited activity through the entire complex. The potential for additional market support moved back into complex remains uncertain as traders may continue to focus on the potential to sustain additional demand through the upcoming months. Cash index for 3/22 is $141.80 up $0.78. Open interest Monday added 185 positions (53,634).

LEAN HOGS:

Open: Mixed. Choppy early trade is slowly developing across hog trade Tuesday morning, but the aggressive market swings seen over the last couple of weeks seem to at least temporarily eased with the potential for increased buyer support to trickle into the complex. Nearby contracts have pulled off of early losses, with gains of 10 to 30 cents per cwt seen through the complex. There is increased overall support seen in the market, allowing for traders to look for renewed interest through the end of the month. Cash hog trade is steady to $2 higher. Most bids are expected to be $1 per cwt higher through the day. Open interest added 5,704 positions (283,880). April fell 428 positions (28,522) and June added 2,715 positions (84,439). Cash lean index for 3/22 is $64.97 up $2.56. DTN projected slaughter for Tuesday is 477,000 head. Saturday runs are expected at 147,000 head.

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

(BAS)

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