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DTN Early Word Opening Livestock       01/13 06:07
   Cattle to Open With Uneven Action

   Look for the cattle complex to open with uneven action as traders position
ahead of late-week cash and engage in last minute profit-taking. Lean hog
issues should also open on a mixed basis thanks to spillover buying and late
long liquidation.

By John Harrington
DTN Livestock Analyst

Cattle: Steady-$2 HR   Futures: Mixed   Live Equiv $130.49  - .44*
Hogs:   Steady-$1 HR   Futures: Mixed   Lean Equiv $ 84.65  -1.31**

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


   Those monitoring the cattle basis this week have worn out their radar guns.
Talk about wild swings. The basis has gone from extreme strength to near normal
back to extraordinary strength. Such volatility has made it extremely difficult
for buyers and sellers to find common ground to trade cattle. In part, that's
why we're kicking out on a Friday morning with virtually no cash business on
the books. Late-week basis strength could play in the favor of packers who have
been watching margins implode this week. On the other hand, fed numbers remain
very tight, perhaps lending feedlot managers extra leverage anyway. Look for
moderate trade volume to develop sometime between late morning and
midafternoon. Bids are likely to open around $116 in the South and $186 to $187
in the North. Asking prices are likely to be restated around $120 plus in the
South and $190 to $192 in the North. Live and feeder futures should open on a
mixed basis as traders position ahead of cash news.
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