DTN Early Word Opening Livestock 04/28 06:35

DTN Early Word Opening Livestock 04/28 06:35 Continued Surges in Wholesale Meat Values Finally Sparks Futures Interest Growing focus on the reduced packing ability due to the coronavirus outbreaks in several plants, and communities where plants call home has created uncertainty about the ability to maintain normal supplies of beef and pork to the retail segment. Limit gains in hog futures Monday focused on the potential for additional support moving through the complex as the week continues. By Rick Kment DTN Analyst Cattle: Steady Futures: Higher Live Equiv $200.09 +11.96* Hogs: Mixed Futures: Higher Lean Equiv $ 88.70 + 6.23** * 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 cattle interest is still in the concept phase at this point of the week with increased showlist levels on Monday being no surprise after weeks of light buying by packers, which are struggling to keep the packing speed at the current levels. The concern that additional packing plants may either have reduced processing levels or close due to COVID-19 will continue to be the main concern over the near future. Monday's surge higher in wholesale beef values posted gains of nearly $20 per cwt in choice and select markets. The widening spread between cash and wholesale prices remains extremely concerning, but the focus on higher beef values has sparked underlying support to develop in futures trade early in the week. The surging wholesale meat values also remains a significant concern for long-term market direction. At this point, there is little indication that retail price levels have followed the recent move in wholesale prices higher over the last month. There are questions if prices will be able to adjust higher to cover boxed beef gains, or if retail price levels do surge higher, will demand evaporate. Given the growing number of unemployment and economic concerns, the ability to maintain strong retail beef demand will be essential once the packing industry is able to move back to a more normal pace. Firm follow-through support is expected in nearby futures early Tuesday, but continued uncertainty may limit stability as the day continues. Tuesday slaughter is expected at 89,000 head.