DTN Early Word Opening Livestock 10/31 06:29

DTN Early Word Opening Livestock 10/31 06:29 Buyer Momentum Continues Aggressive gains in all livestock trade at midweek continued the underlying support in cattle futures. Hog markets were allowed to give into hope of increased demand through the session. By Rick Kment DTN Livestock Analyst Cattle: Higher Futures: Higher Live Equiv: $147.85 +0.51* Hogs: Lower Futures: Mixed Lean Equiv: $ 80.30 -1.28** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: The surge in futures prices and beef values sparked limited midweek cash trade at $111 to $112 through the South with most trades at $112 per cwt. This is $2 per cwt higher than last week. The ability to continue the upward march in cash prices continues to spark some additional underlying buyer interest, as asking prices remain firm at $115 live in the South and $182 in the North. There seems to be little indication that feeders are willing to back away from the elevated prices put on cattle at this point, given the increased packer margin that continues to be built into the complex over the last couple of weeks as beef values have continued to surge higher during October. One of the biggest unknowns is if packers will try to get cash trade done yet Thursday before moving into the month of November, or will they do the bulk of buying on Friday, putting it on November's books? Futures buying is expected to be renewed following strong support in live cattle and feeder cattle futures Wednesday. Even though nearby contracts have posted new short-term highs for this rally with December closing at $118.30 per cwt Wednesday, the ability for feeder cattle to break out of the previous market range with November futures moving above $147 per cwt is sparking increased underlying support through the entire complex. This technical breakthrough in nearby feeder cattle futures is expected to stimulate additional underlying support through the end of the week. Thursday slaughter runs are expected at 117,000 head.