DTN Early Word Opening Livestock 01/09 06:25

DTN Early Word Opening Livestock 01/09 06:25 Traders Start Looking for Cash Cattle Market Direction Limited futures activity is expected early Thursday morning as the focus is moving toward the direction of cash cattle trade for the week. Although packer interest still remains generally quiet, bids are expected to become more available as the day continues. By Rick Kment DTN Analyst Cattle: Higher Futures: Mixed Live Equiv $140.02 -0.09* Hogs: Steady Futures: Mixed Lean Equiv $ 77.65 -0.75** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: The weekly cat and mouse game called cash cattle trade has started, but at this point, packers have shown a general lack of interest, although cattle have been priced by feeders since Tuesday. The few bids in the North at midweek are $198 per cwt and are likely to be reinstated, but this is not likely to gain much attention from bullish feeders, which have been granted higher prices the last several weeks and continue to expect additional support given the tighter supply in the coming weeks. Packers are focusing on preserving margins, which have shrunk considerably over the last month as they look at what could be tighter availability for needed cattle through the next couple of months. So far, packers are showing no intention of slowing procurement rates, but this is likely to change as the spring unfolds. The January USDA crop reports will be released Friday morning. This has the potential to significantly adjust feed price levels and impact overall cattle price levels, potentially keeping cash cattle trade at bay until after the morning report release. Futures trade is expected to remain mixed in a limited trading range. The strong support in feeder cattle futures Wednesday is likely to spark some additional underlying market movement and potential volatility as traders continue to test November highs through the most recent market surge. Thursday slaughter runs are expected near 121,000 head.