DTN Early Word Opening Livestock 01/30 06:19

DTN Early Word Opening Livestock 01/30 06:19 Markets Brace for Additional Price Pressure The last week in livestock trade has shown significant market pressure. This is sparking concerns of follow-through selling through the end of the month. The current bearish tone could significantly impact long-term expectations if liquidation continued into early February. By Rick Kment DTN Analyst Cattle: Lower Futures: Mixed Live Equiv $143.26 +0.25* Hogs: Steady Futures: Mixed Lean Equiv $ 76.38 -4.49** * based on formula estimating live cattle equivalent of gross packer revenue ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: Cash trade still remains sluggish and generally undeveloped going into Thursday morning. A few deals developed in the South about $2 per cwt lower than last week. The limited activity is still likely not enough to call a good market trend, but the combination of weaker cash markets and tumbling futures prices points to moderate price pressure. Asking prices still remain at $125 live in the South and $198 to $200 dressed in the North, but at this point, these seem nearly impossible given the bearish overall tone in all livestock futures trade. Futures trade is expected mixed in limited initial trade. Although the underlying bearish market tone from last week is expected to continue, traders are looking for short-covering opportunities. These opportunities typically present themselves early in the session when overall trade volume still remains light. If enough buyers can move into the market early Thursday morning, there is a chance of bringing stability to the live cattle and feeder cattle trade through the Thursday session. Traders are also looking forward to the cattle inventory report, which will be released Friday afternoon. The opportunity to adjust positions ahead of the report may cause some light interest, but the report itself will not be officially traded until next week given the release of the report will be after the markets close Friday. The overall focus in all livestock markets remains on long-term demand uncertainty. Although expectations that domestic demand will remain strong, the growing supply levels make it essential to escalate export demand of beef and pork in order to push prices higher. Thursday slaughter runs are expected near 121,000 head.