Market News

DTN Early Word Opening Livestock 01/18 06:27

01/18/2018


DTN Early Word Opening Livestock 01/18 06:27
Look for Follow-Through to Support Firm Cattle Opening

Live and feeder futures should open higher, supported by follow-through
buying and cash optimism. Lean hog contracts are likely to open on a mixed
basis thanks to residual selling on one hand and short covering on the other.

By John Harrington
DTN Livestock Analyst



Cattle: Steady-$2 HR Futures: 50-100 HR Live Equiv $138.46 - 0.22*
Hogs: Steady-$1 HR Futures: mixed Lean Equiv $ 86.14 + 24**

* based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue

GENERAL COMMENTS:

Cattle buying interest should start to improve this morning with starter
bids around $118-119 in the South and $190 in the North. Yet advancing futures
have clearly stiffen the backbone of feedlot managers. Barring a major break in
the board, we expect them to dig in their heels with higher asking prices
(i.e., $122-123 in the South; $195-197 in the North). If beef producers stand
tall in this regard, significant trade volume could easily be delayed until
Friday. Live and feeder futures should open on a firm basis, supported by
follow-through buying and stronger cash expectatons.