DTN Early Word Livestock Comments 10/24 06:18

DTN Early Word Livestock Comments 10/24 06:18 Expanded Cattle Futures Trading Limits Tuesday It was a dismal Monday in the cattle complex with February live cattle closing limit down. Feeder cattle exhibited greater losses. Hog futures tried to move higher but made new contract lows and then faded those lows. Robin Schmahl DTN Contributing Analyst Cattle: Lower Futures: Lower Live Equiv: $222.92 +$0.02* Hogs: Higher Futures: Higher Lean Equiv $ 95.79 +$0.58** *Based on formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. Index has been updated to depict recent changes in live cattle weights and grading percentages.) ** based on formula estimating lean hog equivalent of gross packer revenue. GENERAL COMMENTS: Clearly the cattle complex did not have the Cattle on Feed report factored in. Live cattle futures gapped lower on the open Monday and never looked back. Fund liquidation ran rampant as stops were triggered as futures fell through layers of technical support. The last time we saw declines of this magnitude was in 2020 when COVID impacted the market. The pressure Monday moved February live cattle limit down, resulting in expanded trading limits Tuesday of $10.00. Significant selling pressure likely will take place Tuesday as margin liquidation will pressure the market. Boxed beef was the bright spot with choice up $1.26 and select up $1.22. With the fall of futures, packers will bid lower this week, using the weakness to their advantage. Feeder cattle suffered greater losses with the trading limit expanded to $12.25 Tuesday. A thinner trade volume will likely exaggerate the move. Buyers of feeder cattle will pull back significantly at auctions this week.