DTN Early Word Livestock Comments 08/12 06:19
Livestock Futures May Drift Into Weekend
Live cattle found buying interest as cash moved higher than the early trend
indicated. Feeder cattle slipped under the pressure of higher corn futures.
Hogs spent some time in negative territory but finally found strength to close
higher, even though cash fell apart.
DTN Contributing Analyst
Cattle: Higher Futures: Mixed Live Equiv: $194.01 +$0.02*
Hogs: Lower Futures: Lower Lean Equiv: $131.39 -$0.36**
*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 certainly was a positive day for cattle feeders as cash increased more
than expected and packers became more aggressive. Cash generally ranged from
$2.00 to $4.00 higher with some cattle in Texas seeing a $5.00 gain. This was
what traders needed to push August futures to triple-digit gains. Trade in
later contracts was a bit more hesitant with premium already factored in. The
strong slaughter pace has packers needing more cattle, even though they had
been forward contracting some over the past few weeks in the attempt to
minimize the need to bid up very much. That came to an end this week as strong
demand continues. Boxed beef prices were mixed with choice down $0.13 and
select up $0.38. Weekly export sales were better than last week at 14,600
metric tons (mt) but below the four-week average.
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