DTN Midday Livestock Comments          12/03 12:01

   Cattle Continue to Trade Higher Upon Stronger Fundamentals

   With both the live cattle and feeder cattle contracts trading higher into 
Wednesday's noon hour, there's a chance that the board's positive support could 
encourage stronger cash cattle trade this week. 

ShayLe Stewart
DTN Livestock Analyst

GENERAL COMMENTS:

   The cattle complex is trading higher again today as traders are pleased to 
see the continued uptick in boxed beef prices. Still no cash cattle trade has 
developed but asking prices are noted at $225 plus in the South. March corn is 
down 6 3/4 cents per bushel and January soybean meal is down $0.40. The Dow 
Jones Industrial Average is up 375.78 points and NASDAQ is up 44.34 points.

LIVE CATTLE:

   The live cattle complex is trading higher into Wednesday's noon hour, 
thankful to again see stronger boxed beef prices. The market initially opened 
lower at Wednesday's start, but upon seeing improved fundamentals, traders felt 
as though there was enough support in the market to justify trading the 
contracts higher. December live cattle are up $1.37 at $219.85, February live 
cattle are up $1.67 at $222.57 and April live cattle are up $1.52 at $223.95. 
Still no cash cattle trade has developed, but asking prices are noted in the 
South at $225, and are still not established in the North. It is assumed that 
cash prices will be higher this week with the uptick in boxed beef prices and 
with the board's support.

   The other factor that could be helping drive the cattle contracts higher is 
the announcement from Texas Agriculture Commissioner Sid Miller that another 
detection of New World screwworm (NWS) was found in Montemorelos, Nuevo Leon, 
Mexico, which is approximately 120 miles south of the Texas border. This 
development could mean that the border will stay closed longer than assumed.

   Boxed beef prices are higher: choice up $0.68 ($365.40) and select up $2.31 
($353.09) with a movement of 79 loads (53.75 loads of choice, 9.28 loads of 
select, 4.12 loads of trim and 11.50 loads of ground beef).

FEEDER CATTLE:

   With the live cattle market's support, the feeder cattle complex is trading 
over $3.00 higher into Wednesday's noon hour. It was rather impressive to note 
some of the sales made Tuesday afternoon at sale barns across the country as 
some were trading $20.00 to $30.00 higher, with instances as much as $50.00 
higher than the week before. That obviously showed up in the CME feeder cattle 
index as well, which jumped $12.66 to $332.36. Today's support of the futures 
contracts should only encourage more buying in sale barns this afternoon. 
January feeders are up $3.12 at $333.00, March feeders are up $3.25 at $327.17 
and April feeders are up $2.90 at $326.20.

LEAN HOGS:

   After enduring a couple days of weaker trade, the lean hog complex is back 
to trading higher as the market is no longer up against immediate resistance 
pressure. December lean hogs are up $0.20 at $80.70, February lean hogs are up 
$0.97 at $81.15 and April lean hogs are up $0.90 at $84.72. Helping encourage 
traders to send the contracts higher is also the fact that pork cutout values 
are a tick stronger.

   The projected lean hog index is delayed from the source. Hog prices are 
lower on the Daily Direct Morning Hog Report, down $1.05 with a weighted 
average price of $69.01, ranging from $65.00 to $74.00 on 3,063 head and a 
five-day rolling average of $69.36. Pork cutouts totaled 172.37 loads with 
148.58 loads of pork cuts and 23.79 loads of trim. Pork cutout values: up 
$0.47, $94.69.

   ShayLe Stewart can be reached at shayle.stewart@dtn.com




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