DTN Early Word Opening Livestock 11/08 06:23

DTN Early Word Opening Livestock       11/08 06:23
   Cash Cattle Support Sought Friday

   Cash cattle trade is expected to continue with a firmer market tone
following initial trade in the North Thursday. The underlying firmness in the
market should point to increased activity and price gains in all areas.

By Rick Kment
DTN Livestock Analyst

Cattle: Higher Futures:  Mixed   Live Equiv $152.64 +0.85*
Hogs:   Lower Futures:   Mixed   Lean Equiv $ 85.49 -0.30**

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


   Light to moderate trade that developed Thursday afternoon in the North is
expected to have set the firmer market tone for the week. The full range of
cattle sold Thursday is $177 to $182 per cwt dressed basis, but most cattle
sold at $181 to $182 per cwt. This is $1 to $2 per cwt higher than last week's
average, allowing for positive market expectations to develop in all other
areas. The combination of underlying support in wholesale beef values, futures
trade and extremely large packer margins is helping to stimulate a healthy
appetite to keep plants at capacity through the near future. Futures trade is
expected mixed in sluggish early trade as traders continue to struggle to break
away from the light to moderate range that has been established over the last
couple of weeks. Even though there remains firm underlying support, the ability
to break through short-term resistance levels in live cattle or feeder cattle
trade remains uncertain. Given still strong cattle supplies and traditional
seasonal pressure through the holidays, it may be difficult to spark aggressive
follow-through buying in order to continue to aggressively move prices higher.
Friday slaughter runs are expected at 116,000 head.