DTN Early Word Opening Livestock 04/16 06:28

DTN Early Word Opening Livestock 04/16 06:28 Meat Supply and Demand Issues Keep Market Guessing Continued uncertainty in meat demand in the upcoming weeks combined with increased packing and processing plant closures is likely to grow over the near future. By Rick Kment DTN Analyst Cattle: Lower Futures: Mixed Live Equiv $150.18 +3.05* Hogs: Lower Futures: Mixed Lean Equiv $ 57.06 -0.97** * 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 business is generally undeveloped going into Thursday morning. Although limited trade developed in the North on a dressed basis Wednesday, the amount of activity is still too small to create any market trend. The pullback in plant processing levels across the country and continued announcements of positive COVID-19 cases at packing plants continues to create questions of how active packers will be in sourcing cattle through the end of the week. It is expected that some bids will start trickling into the market over the next day, but any cash market activity may be delayed until Friday, if at all. Even for packers that have not shut down, the expectation that nearly all plants are running reduced levels of production either on the kill floor or fabrication lines due to reduced employee attendance will continue to reduce overall beef output over the near future. Continued uncertainty of meat demand, especially for higher end cuts such as roasts and steaks due to changing buying patterns in the food service industry continues to add concern to the ability to keep product availability balanced through this time. The strong push higher in beef cutout values has more to do with uncertainty about continued beef supply rather than current change in demand. This still leaves the livestock producer holding the bag, as the ability to find processing facilities for market-ready cattle is becoming even more difficult, even for cattle that are already committed. Futures trade is expected mixed as the moderate shift in nearby contracts Wednesday helped to break away from the wide market swings early in the week. The ability to keep markets generally calm going into opening bell could help to stimulate additional buyer support through the end of the week. Thursday slaughter is expected at 93,000 head.