DTN Closing Livestock Comments

GENERAL COMMENTS:

Moderate cattle trading developed in most areas with feedlot managers reluctantly accepting lower bids in the face of bearish futures and outside markets. Most live business in the South was marked at $133, $3 lower than last week. Dressed deals in the North were mostly $4 lower at $206. According to the closing report, the Iowa hog base is 0.56 higher compared with the Prior Day settlement ($52.00-64.50, weighted average $63.64). Corn futures settled fractionally lower, depressed by another round of bearish export sales. U.S. equities closed lower, but well off their lows, as investors digested a massive global sell-off, falling oil prices, and chatter about a possible OPEC production cut. The Dow closed 254 points lower with the Nasdaq down by 16.

LIVE CATTLE:

Live futures collapsed further Thursday, pressured by long liquidation, discouraging cash news, and outside markets. April closed under 130 for the first time since Jan. 20. Beef cut-outs: mixed, up $0.65 (select, $214.27) to off $1.17 (choice, $217.02) with light to moderate demand and offerings (85 loads of choice cuts, 14 loads of select cuts, 12 loads of trimmings, 48 loads of coarse grinds).

FRIDAY'S CASH CATTLE CALL:

Steady with Thursday. While a few clean-up deals are possible, it looks like the lion's share of business is done for the week.

FEEDER CATTLE:

Feeder contracts broke sharply lower, settling off 97 to 185 points lower. Selling was tied to the defensive action in the live trade where discounted deferred contracts represent uninspiring targets for feedlot managers. CME cash feeder index: 02/10: $158.79, off $0.70.

LEAN HOGS:

Lean contracts closed mostly 37 to 110 points higher. Spot February is set to expire Friday at high noon Central Time. Interestingly, soon-to-be-spot April was anything but shy Thursday, surging sharply higher despite its preexisting premium to the cash index. The board seems to reflect plenty of confidence in supportive fundamentals through the first quarter. Carcass value fell hard Thursday, pressured by softer demand for fresh cuts and hams. Pork cut-out: $75.52, off $1.53. CME cash lean 02/09: $65.29, up $0.40 (DTN Projected lean index for 02/10: $65.60, up $0.31).

FRIDAY'S CASH HOG CALL:

Steady to $1 higher. Expect hog buyers to complete their weekly chores with another firm round of cash sales, urged by both decent margins and ambitious Saturday kill plans.

For more from John, see www.feelofthemarket.com

(CZ)

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