DTN Early Word Opening Livestock 12/17 06:10
Further Livestock Selling Seems Likely at Midweek
Live and feeder cattle futures seem set to open substantially lower once
again, pressured by bearish momentum, technical selling, and a serious lack of
buying interest. Lean hog contracts are also likely to lose more ground on the
opening, checked by residual long liquidation and yesterday's bad stumble in
the pork carcass value.
By John Harrington
Cattle: Steady-$2 LR Futures: 100-300 LR Live Equiv $166.69 - $1.18*
Hogs: Steady-$1 LR Futures: 50-100 HR Lean Equiv $ 96.53 - $4.48**
* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue
Psychology in the cattle market continues to devolve with imploding futures
and struggling cut-outs lowering the cash expectations of feedlot managers.
Scattered dressed sales were reported in parts of the North on Tuesday at $252,
nearly $5 lower than last week's weighted average basis Nebraska. Given the
confusion naturally generated by the runaway board selling seen so far, both
buyers and sellers would no doubt like to see CME smoke start to clear before
they have to get serious about trading cattle. We assume that tentative asking
prices will be around $2-3 over spot December live. Live and feeder futures
seem ready to push further lower on the opening, pressured by bearish momentum
and technical selling.
Your local weather forecast from DTN can be sent to your email every morning free through DTN Snapshot