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DTN Early Word Opening Livestock       04/08 06:45
   More Volatile Price Swings Likely Wednesday Morning

   Limit gains in all livestock markets Tuesday will allow for expanded trading
limits to develop midweek. Although firming support is building through the
complex, demand uncertainty may create mixed early activity.

By Rick Kment
DTN Analyst

Cattle: Steady to Lower   Futures: Mixed    Live Equiv $149.00 -0.23*
Hogs:   Lower             Futures: Higher   Lean Equiv $ 59.65 -2.96**

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


   Cash cattle remained sluggish most of Tuesday but by the end of the day
limited light trade developed in several areas at $105 per cwt live basis. This
is generally $4 per cwt lower than last week's live price levels and indicates
a limited interest by packers with general plant slowdowns through the week and
the upcoming lighter kill schedules surrounding the holiday weekend. Easter
weekend traditionally is the one holiday where overall processing levels are
significantly reduced on both sides of the holiday with holiday-related
reductions planned both Friday and Monday. This adds to the already slowing
pace of moving cattle due to two small-to-medium plants suspending production
already, and increased absenteeism at most other facilities, limiting the
amount of cattle packers can move through the system. More active cash trade is
expected over the next two days, but the firmness in the futures market may not
spark significant cash market gains given, but instead weaken basis levels from
the current large levels currently. Futures trade is expected mixed to mostly
higher early Wednesday morning. The limited volume on Tuesday due to contracts
locked in limit gains is likely to create follow-through buying as well as
attempts to cover positions as markets move higher. The thought that the
coronavirus pandemic may be close to peaking has spurred strong buyer support
through most markets, potentially establishing a well-defined market bottom
early in the week. There still remains a lot of concern of how overall meat
demand will rebound over the coming weeks and months based on the damage to the
economy through the pandemic. This could add even more wide market swings
through the rest of a potentially lightly traded week. Wednesday slaughter is
expected at 110,000 head.
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