DTN Early Word Livestock Comments 06/09 06:26
WASDE Report May Provide Direction
Cattle futures tried to move higher Thursday but succumbed to further
selling pressure in the end. This is surprising as cash cattle traded higher
this week. Hogs put in somewhat of a quiet day with August closing its chart
DTN Contributing Analyst
Cattle: Steady Futures: Mixed Live Equiv: $239.50 +$2.32*
Hogs: Lower Futures: Mixed Lean Equiv: $92.77 +$0.53**
*Based on formula estimating live cattle equivalent of gross packer revenue.
(The Live Cattle Equiv. Index has been updated to depict recent changes in live
cattle weights and grading percentages.)
** based on formula estimating lean hog equivalent of gross packer revenue.
It was surprising livestock futures closed lower Thursday. The market looked
as if it was going to rebound, only to run out of aggressive buying interest in
the end. Cash cattle traded higher this week in the North while most Southern
trade should take place Friday. So far it has been light, but what has taken
place has been $3.00 to $7.00 higher. Boxed beef was strong again Thursday with
choice cuts up $3.54 and select up $2.54. So far, it has been a strong week for
boxed beef, which provides the confidence for feedlots to hold for higher cash.
Weekly export sales totaled 12,800 metric tons (mt) which was down 29% from the
previous week, indicating higher prices may be impacting international demand.
Feeder cattle futures began slipping as corn futures began climbing from early
losses. Feeder cattle are in demand with higher prices being paid at auctions,
but traders traded market correlations and corn in one of those correlations.
The WASDE report will impact grains and that may provide direction for cattle.
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