DTN Early Word Opening Livestock

Cattle: Steady            Futures: Mixed   Live Equiv: $154.24 +0.86* 
Hogs:   50 cents higher   Futures: Mixed   Lean Equiv: $ 91.90 +1.33**
*   based on formula estimating live cattle equivalent of gross packer revenue 
** based on formula estimating lean hog equivalent of gross packer revenue

GENERAL COMMENTS:

Cash cattle interest is expected to remain sluggish most of the day Tuesday with bids and asking prices still undeveloped at this point. It is likely that additional interest will slowly trickle into the complex midweek. The potential for early-week trade on Wednesday for the fourth week in a row is actually pretty good this week due to Friday being a market holiday with both sides being willing to wrap up cash business early this week. Futures trade is expected to remain generally sluggish Tuesday following slow but steady market firmness the past couple trading sessions. Even though the market remains stuck in the wide sideways trend, the focus on current supplies and the ability to meet growing seasonal beef demand is likely to help keep buyers interested through April, although at most times not overly aggressive.

The hog complex still has so many unknowns that are keeping traders uneasy, but optimistic given the potential shift in market demand that some of these unknowns can bring to the entire industry. With African swine fever still a major threat to not only China pork production, but production in many areas of Asia and some sections of Europe, it is unclear just how much pork will be needed to fill current demand, and how quickly herds can be repopulated in many of these areas. The trade deal with China continues to be on most traders' minds, as it is uncertain when a deal will be agreed upon, and what that deal will look like for pork products. Even though these issues continue to focus on export demand and moving U.S. pork around the world, it is important not to forget that overall pork demand continues to strengthen domestically, which is helping to add even more firmness to the complex. Cash trade is called $1 lower to $1 higher Tuesday morning with most bids steady to 50 cents higher. Expected slaughter Tuesday is at 456,000 head.

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

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