DTN Early Word Opening Livestock 03/19 06:27

DTN Early Word Opening Livestock 03/19 06:27 Price Divergence Between Futures and Meat Prices Continue Continued support in wholesale beef and pork values through the week is separating the direction of futures trade from market fundamentals. This is expected to add increased volatility through the end of the week in cattle and hog futures. By Rick Kment DTN Analyst Cattle: Steady to Higher Futures: Mixed Live Equiv $161.89 +4.60* Hogs: Higher Futures: Mixed Lean Equiv $ 79.76 +0.48** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: Packers have been aggressive in their search for market-ready cattle, but the focus has split between the aggressive recent pressure in futures trade and incredible strength in wholesale beef values through the week. With consumer demand running high, especially for any sign of ground beef product, the focus on moving product through the plant and onto store shelves has helped boxed beef values surge through the week. This stimulated cash cattle trade through the week in a wide and mixed trading range with prices of live cattle at $105 to $113 per cwt, while dressed cattle sold at $168 to $177 per cwt. It is still uncertain where the weekly average will fall, but cattle are sold from anywhere from $7 lower to $4 per cwt higher than last week's average. The timing of cash cattle sales through the week has been important as packers remain focused on gaining additional numbers in order to satisfy current orders that are aggressively building. Futures trade is expected to remain mixed, and could easily see wide market swings similar to Wednesday. The overnight pressure in the Dow Jones futures is being countered by aggressive overnight buying support in most other commodity markets, leaving the livestock open uncertain as most of the initial activity will be triggered by computer-generated trade. All livestock trade is moving back to regular trading limits, as nearby contracts closed below the daily limits Wednesday. Thursday slaughter is expected near 121,000 head.