DTN Early Word Opening Livestock 03/18 06:38

DTN Early Word Opening Livestock 03/18 06:38 Will Tuesday's Gains Hold Off Outside Market Pressure Were Tuesday's gains a one-day reaction, or has renewed underlying support started to redevelop across the entire livestock trade? This will be the main question facing traders in the early minutes of activity Wednesday. By Rick Kment DTN Analyst Cattle: Mixed Futures: Mixed Live Equiv $156.99 +9.06* Hogs: Higher Futures: Mixed Lean Equiv $79.28 +1.04** * 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 activity started to develop a rhythm Tuesday with light to moderate activity developed steady to higher than Monday's levels. Live trade developed generally at $110 per cwt, which is steady with early-week activity, while most dressed business developed at $170 to $175 per cwt, steady to $5 per cwt higher than the initial-week activity. The focus on market moves through the complex is being driven by the aggressive movement in wholesale beef values over the last two days. Boxed beef values have rallied more than $30 per cwt in choice cuts for the week, focusing on the intense consumer demand for beef and all meat as suppliers do all they can to keep fresh product on store shelves. Although at this point, there has been little evidence of significant demand pressure in beef and all meat markets from the food service industry, the expectation is that additional demand losses will develop over the coming days and weeks. But until the average consumer builds comfortable refrigerator and freezer stocks, the intense demand for fresh product is expected to continue. The direction of futures trade remains uncertain through overnight activity. The strong gains Tuesday will allow for another day of expanded trading limits in live cattle, while feeder cattle futures will move back to a normal schedule. This will leave all livestock trade with a $4.50 per cwt trading limit as traders balance early outside market pressure with strong fundamental beef price gains. Volatility is still expected to remain strong through most of the morning, but futures trade could be a loose cannon pointing in any and all directions through early trade. Wednesday slaughter is expected near 121,000 head.