Livestock Futures: Monthly Fundamental Overview

Feeder Cattle & Grains

Hogs & Pigs

Sample from Livestock Trader's Almanac for
November 2001 Livestock Fundamentals

Each of these statistics, plus general commentary are provided each calendar month for specific contracts to help participants make more informed trading decisions. These figures are not intended to be buy or sell recommendations but merely representations of historic performance. The General Comments are statements of opinion and are subjective in nature ... but hopefully they will help guide you to what we feel is important!

Live Cattle & Beef

7-State Cattle on Feed 1,000 + Capacity (in 1,000 Head)
	1996	1997	1998	1999	2000	2001
Cattle On Feed Oct 1st	7,486	8,558	8,376	8,793	9,502
During October:
Placed on Feed	2,536	2,454	2,396	2,629	2,387
Fed Cattle Marketed	1,431	1,545	1,537	2,387	1,647
Other Disappearance	57	77	45	63	50

Cattle on Feed Nov 1st	8,534	9,390	9,190	9,789	10,192

COMMENTS: Marketing of Live Cattle for slaughter tends to reach its seasonal low in November ~ Supplies of slaughter weight animals tend to be low as recent surge in placements can create winter holes in slaughter weight animals ~ Cattle on Feed numbers tend to be the second highest of the year, peaking in December ~ Boxed Beef prices tend to decline as increased competition from Turkey and Ham due to holidays weighs on beef ~ Extreme early winter can increase other Disappearance

October Number Placed on Feed by Weight Group (in 1,000 head)
	1996	1997	1998	1999	2000	2001
Less Than 600	846	816	776	1027	1066
600 - 699	724	715	649	802	755
700 - 799	826	745	686	692	531
800 Plus	611	620	719	593	477

Source: USDA Cattle on Feed Report

Cattle Feeder Costs to Live Price Relationship
	1996	1997	1998	1999	2000	2001
Jan Feeders	64.43	66.15	79.93	70.50	85.10
Dec Corn	270 ¾	271 ½	218 ¾	187 ½	208 ¾
Apr Live	64.98	72.35	64.83	71.35	75.40
P&L	$123.51	$197.82	$24.75	$194.70	$115.45

COMMENTS: Most Cattle have moved off of pasture into feedlots during the August through October placement rush ~ Late spring bred calves tend to be lighter weight ~ Lower supply and lower weights tend to be supportive of Feeder Steer prices ~ Grain Harvests tends to create ample grain supplies and low prices which is supportive for Feeders

Source: Futures data compliments of www.GECKOSOFTWARE.com. Pasture Conditions from USDA/NASS Crop Progress Reports

End of Month Pasture Condition National Average

5- Year Average

Monthly Hogs & Pigs Report (in 1,000 head)
	2000	2001
Sows Farrowing	922
Pigs Per Liter	8.86
Pig Crop	8311
Sows& Gilt Inventory	6055
Number Bred	1168

Weekly Slaughter Rate (in 1,000 Head)
	1996	1997	1998	1999	2000	2001
11/3/01	1,845	1,957	2,096	2,093	2,092
11/10/01	1,840	1,927	2,136	2,114	1,969
11/17/01	1,770	1,899	2,088	2,043	2,042
11/24/01	1,898	1,980	2,191	2,031	1,764

COMMENTS: Hog and Pig slaughter rates tend to peak in October and slow in November ~ Average weekly slaughter rate in 2000 was 1.97 million head ~ The slow down in slaughter tends to be supportive for prices as packers must raise bids to attract animals for slaughter ~ Build ups in supply ahead of the Christmas Holiday season surge in demand is generally supportive of prices, especially in mid to late November

Source: Monthly Hogs & Pigs Report and USDA/AMS Daily Hog Slaughter Report

Of course, market psychology and general price trends also have a dramatic effect on futures pricing. This is why the Livestock Trader's Almanac also provides a monthly TECHNICAL OVERVIEW to help participants in the livestock futures markets get a handle on these factors as well.

THE DATA CONTAINED HERE IN ARE BELIEVED TO BE RELIABLE BUT CANNOT BE GUARANTEED AS TO RELIABILITY, ACCURACY, OR COMPLETENESS; AND, AS SUCH ARE SUBJECT TO CHANGE WITHOUT NOTICE. CFEA WILL NOT BE RESPONSIBLE FOR ANYTHING, WHICH MAY RESULT FROM RELIANCE ON THIS DATA OR THE OPINIONS EXPRESSED HERE IN.

DISCLOSURE OF RISK: THE RISK OF LOSS IN TRADING FUTURES AND OPTIONS CAN BE SUBSTANTIAL; THEREFORE, ONLY GENUINE RISK FUNDS SHOULD BE USED. FUTURES AND OPTIONS MAY NOT BE SUITABLE INVESTMENTS FOR ALL INDIVIDUALS, AND INDIVIDUALS SHOULD CAREFULLY CONSIDER THEIR FINANCIAL CONDITION IN DECIDING WHETHER TO TRADE. OPTION TRADERS SHOULD BE AWARE THAT THE EXERCISE OF A LONG OPTION WOULD RESULT IN A FUTURES POSITION.

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW.

NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO, ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM, IN SPITE OF TRADING LOSSES, ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS, IN GENERAL, OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.