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DTN Early Word Opening Livestock       10/17 06:26
   Livestock Traders Searching for Cash Trade Direction

   Limited interest thus far in cash cattle trade has kept markets sluggish and
looking for potential end-of-the-week movement. The underlying support in live
cattle futures continues to spark firm expectations in cash values.

By Rick Kment
DTN Livestock Analyst

Cattle: Steady to Higher   Futures: Mixed   Live Equiv $139.62 +0.14*
Hogs:   Higher             Futures: Mixed   Lean Equiv $ 82.49 -0.34**

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


   Cash cattle activity remains on the back burner through the early part of
the week with asking prices becoming more available at $111 to $112 per cwt
live basis in the South and holding at $180 in the North. The overall lack of
packer bids so far this week is not unusual, but prices should be more
available through the day Thursday. Although it is uncertain just how
aggressive packers will be until the end of the week, it appears that market
firmness should develop given the underlying bullish tone in futures trade so
far this week as well as steady gains in beef values. Futures trade is expected
mixed in a narrow-to-moderate trading range as the focus will once again return
to December contracts as they slowly but steadily continue the bullish shift
higher during the week. Even though prices are still have ground to cover
before reaching resistance levels set at July highs of $114.35 per cwt, this
target is well in sight, and attainable through the end of the week given the
steady but measured market support over the last month. October futures remain
lightly traded with limited interest, but the strong shift higher Wednesday,
quickly narrowed the price spread between October and December contracts,
helping to add even more firmness through the cattle complex. Feeder cattle
futures are expected to show limited activity early Thursday morning, but
outside markets will likely become a major factor late in the week with an
increased focus on grain trade and production costs. Thursday slaughter runs
are expected at 117,000 head.
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