DTN Closing Livestock Comments

GENERAL COMMENTS:

Feedlot country was typically limited to the distribution of new showlists. The fed cattle offering looks larger in Texas, Kansas and Colorado but somewhat smaller in Nebraska. Asking prices were poorly defined. According to the closing report, the Iowa hog base is $0.49 higher compared with the Prior Day settlement ($56.00-63.50, weighted average $62.89). Corn futures settled 3-4 cents lower, curbed by more rain in Argentina, lower oil prices, and positioning before new s&d data scheduled to be unveiled Tuesday. Though equities got off to a rough start, Wall Street closed off session lows amid a late rally in the energy sector. The Dow closed 177 points lower with the Nasdaq down 79.

LIVE CATTLE:

Live issues slumped with losses of 300 points across the board (i.e., triggering expanding limits of 450 on Tuesday). Steep losses were primarily triggered by outside markets riddled with fear over slowing global growth. Fundamentally, the early week sell-off was also fueled in part by disappoint feedlot sales late last week (i.e., $136 basis Kansas and Texas, $2 lower). Beef cut-outs: mixed, up $0.07 (select, $216.58) and off $1.79 (choice, $218.81) with light to moderate demand and moderate offerings (74 loads of choice cuts, 17 loads of select cuts, 7 loads of trimmings, 28 loads of coarse grinds).

TUESDAY'S CASH CATTLE CALL:

Steady. Chances are Tuesday will be another slow-go in the cash cattle area. Indeed, bids and asking prices may postpone significant definition until Thursday or Friday.

FEEDER CATTLE:

Panic selling also haunted the feeder market with all months collapsing down the 450-point limit. Exchange rules allow limited to expand to 600 points here when trade resumes on Tuesday. On an estimated of 6,200 head (down from 9,128 last week and 8,557), Oklahoma City sold steers and heifers mostly $1-$2 lower. CME cash feeder index: 02/05: $160.15, up $0.48.

LEAN HOGS:

In comparison, lean hog futures had a fairly respectable round of business, closing for the most part "only" 15 to 60 lower. Lean issues withstood the outside storm much better than the cattle complex thanks to impressive fundamentals. Soon-to-expire spot Feb managed to settle 22 points higher, supported by the advancing cash index. The carcass value closed moderately lower, checked by softer demand for loins, picnics, ribs, and bellies. Pork cut-out: $76.96, off $0.61. CME cash lean 02/04: $64.30, up $0.32 (DTN Projected lean index for 02/05: $64.62, up $0.32).

TUESDAY'S CASH HOG CALL:

Steady to $1 higher. Hog buyers should open in the morning with another round of firm bids as country numbers continue to tighten.

For more from John, see www.feelofthemarket.com

(CZ)

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