DTN Early Word Opening Livestock 08/29 06:25

DTN Early Word Opening Livestock 08/29 06:25 Mixed Trade Expected in Early Trade Firm midweek gains in lean hog futures is expected to be tested following additional underlying pressure in cash hog and pork values. Cattle trade is looking for end-of-the-week stability after being unable to hold recent gains. By Rick Kment DTN Analyst Cattle: Steady Futures: Mixed Live Equiv: $150.62 -1.16* Hogs: Lower Futures: Mixed Lean Equiv: $ 76.83 -2.06** * 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 trade is expected to become much more active over the next couple of days, with packer interest likely to improve through the morning. A few cattle were sold in Nebraska and Kansas Wednesday afternoon, with prices at $103 to $104 in the South and $172 to $175 in the North. Although the numbers sold is limited, the lack of support from last week's levels is somewhat disappointing, and could create bearish market indications through the end of the week. With the Labor Day holiday on Monday limiting procurement levels, and additional contracts expected to be delivered after the first of the month, it is uncertain how many additional cattle need to be bought before the end of the week. This could further limit packer interest or aggressive bidding for cattle in the near future. Secretary Perdue announced Wednesday afternoon that he has directed the Packers and Stockyards Division to investigate recent beef price margins. Following the Tyson plant fire on Aug. 9, plant margins surged as beef values and cattle prices quickly and aggressively moved in opposite directions. It is uncertain the timeline or speed of an investigation. The underlying weakness in cattle futures trade is expected to continue, with prices remaining under pressure. But at current levels, the market remains oversold, creating the potential for a late month rally.