DTN Before The Bell Livestock

Limited Trade Direction Monday Morning

Rick Kment
By  Rick Kment , DTN Analyst
(DTN photo by Nick Scalise)

GENERAL COMMENTS:

Light trade is seen in all livestock trade Monday morning as traders return from the Thanksgiving holiday weekend. Limited market direction is likely through most of the morning with end-of-month positioning likely to be seen in most contracts. Corn is trading lower in light to moderate trade. Stock markets are lower in limited morning trade. Dow Jones is 297 points lower with NASDAQ down 27 points.

LIVE CATTLE:

Open: Steady to 50 cents lower. Firm pressure has moved into live cattle futures with traders adding to Friday's losses. At this point, the market move lower has little to do with fundamental or technical market moves and more to do with end of month adjustments due to limited trade interest. Prices could hover within a moderate trading range through the entire session without sparking significant market movements in either direction. Cash cattle markets are quiet with show list distribution and inventory taking likely the extent of market activity for the day. Following mostly higher prices last week, feeders are going to remain aggressive when pricing cattle, but it is likely to be near midweek before active asking prices or bids are seen. Open interest slipped 249 positions (275,544). December contracts lost 1,300 positions (24,197) and February contracts fell 455 positions (111,523). DTN projected slaughter for Friday is 114,000 head.

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FEEDER CATTLE:

Open: Steady to 20 cents lower. Narrow losses slowly developed in feeder cattle trade as traders adjust to the recent market support seen during late November. The uncertainty of just how much additional short term support will move into the market Monday is limiting trade direction. End-of-month price and position adjustments are likely to develop over the next few hours, which could leave prices mixed in a narrow to moderate range through most of the session. Cash index for 11/25 is $136.90, down 0.53. Open interest Friday added 255 positions (37,412).

LEAN HOGS:

Open: Steady to $1 higher. Initial buyer support quickly moved into nearby lean hog futures with early gains of $1 per cwt seen in December and February futures. This move helped to push prices through initial resistance levels, helping to instill limited but noticeable technical buyer support as traders end the month of November. The ability to hold prices through the end of the session will be closely watched as this could help set the tone for all hog trade through the end of the year. Cash hog bids are expected $1 lower to $1 per cwt higher, with most bids steady 50 cents lower. Open interest fell 413 positions (201,151). December fell 2,313 positions (21,651) and February gained 612 positions (82,425). Cash lean index for 11/24 is $67.38, down 0.32. DTN projected slaughter for Monday is 488,000 head.

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

Editor's Note: See DTN Livestock Analyst ShayLe Stewart's complete 2021 market outlook live by attending the DTN Ag Summit, Dec. 7-9. This year's event is virtual, and as a DTN subscriber you can attend for FREE. Our premier farmer and rancher event features markets updates from ShayLe, DTN Lead Analyst Todd Hultman and a weather outlook by Senior Ag Meteorologist Bryce Anderson. Other speakers include: U.S. Ambassador Kip Tom; Ken Eriksen and Paul Hughes of IHS Markit; Microsoft Chief Scientist Ranveer Chandra; personal development speakers David Horsager and Jon Gordon; farmers Reid and Heather Thompson; farm blogger Meredith Bernard, and many more.

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Rick Kment