DTN Early Word Opening Livestock 09/26 06:25

DTN Early Word Opening Livestock 09/26 06:25 Growing Demand Support Draws Buyers Recent news of increased interest from Chinese buyers in U.S. pork supplies and the announcement of the Japan trade deal is expected to spark follow-through buying. Additional underlying support is likely to slowly move into the complex as traders focus on growing fundamental support. By Rick Kment DTN Livestock Analyst Cattle: Steady to Higher Futures: Higher Live Equiv: $137.91 -0.24* Hogs: Higher Futures: Higher Lean Equiv: $ 75.18 +0.67** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: Packer interest is expected to become more active as the day progresses Thursday, although at this point, it is uncertain if active trade will develop Thursday or be held over to Friday. Asking prices remain firmly planted at higher levels of $104 to $105 live basis in the South and $170 in the North. The expectation is that any initial bids in the market will be a far cry from current asking prices, leaving a strong gap for negotiations to fill over the next couple of days. Overall market-ready cattle supplies appear to be starting to tighten from the previous week's levels, although it will still be some time before packers see enough of a pinch in supplies in order to actively negotiate access to cattle. With the end of September quickly approaching, it is also uncertain just how active packers will be given increased contract deliveries set for early October. Futures trade is expected to focus on the uptick in the complex as traders continue to focus on expected short and long-term demand building through the complex while expanding the bullish market trend in the last two weeks. December futures have currently rallied $9.50 per cwt above August lows, as increased fundamental support also helping to stimulate technical gains.