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DTN Early Word Opening Livestock       08/21 06:06
   Momentum in Livestock Futures Building

   Following early week support in lean hog and cattle trade, prices may have
turned the corner from bearish market shifts last week. This could help
rekindle buyer support early Wednesday.

By Rick Kment
DTN Analyst

Cattle: Steady to Firm   Futures: Higher   Live Equiv: $154.62 +0.87*
Hogs:   Lower            Futures: Higher   Lean Equiv: $ 88.77 -1.07**

*   based on formula estimating live cattle equivalent of gross packer revenue
** based on formula estimating lean hog equivalent of gross packer revenue


   Cash cattle trade continues to remain undeveloped going into the midweek
session with both sides looking for additional direction. Given the aggressive
rally in beef values over the last 10 days, feedlot managers are even more
unwilling to back away from initial asking prices. Packers continue to focus on
the reduced packing capacity due to Tyson's plant shutdown in Kansas, but if
the weekend schedules increase, most if not all of the production losses likely
will be made up. Packer bids are expected to become more evident through the
day, although at this point, trade may not develop until later in the week,
potentially after Friday's Cattle on Feed report. Futures trade is expected
mixed to mostly higher with follow-through gains developing after the positive
close Tuesday afternoon. Although the market still remains under the shadows of
the bearish market shift last week, traders are starting to break away from
market lows, with additional potential to push prices moderately higher in the
near future.
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