DTN Early Word Livestock Comments 04/19 06:31

DTN Early Word Livestock Comments 04/19 06:31 Follow-Through Strength in Hogs Expected Feeder cattle felt the pressure from higher corn futures as the cost of production continues to rise. The pressure spilled over into live cattle as this may reduce some of the bargaining power feedlots might have this week. Hogs exploded to the upside, closing the chart gaps and negating the island top that had been established earlier. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Mixed Live Equiv: $202.07 -$0.65* Hogs: Higher Futures: Higher Lean Equiv: $116.91 -$0.72** *Based on formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. Index has been updated to depict recent changes in live cattle weights and grading percentages.) ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: Feedlots were hoping to capitalize on both the higher cash and stronger futures of last week. However, those hopes were trimmed Monday due to substantially higher corn futures and lower cattle futures. Showlists indicate higher offerings this week, which may leave packers unwilling to bid higher. The resolve of feedlots will be tested as it looks like feed prices are not going to become less expensive and holding onto cattle any longer than necessary may be a losing proposition. More market-ready cattle are expected to hit the market in May and early summer, which may limit upside price potential. Cutouts were mixed Monday with choice down $1.54 and select up $0.56. The Commitment of Traders showed funds as net sellers of 766 contracts, bringing their net-long positions to 39,498 contracts.