DTN Early Word Livestock Comments 10/28 05:50
Live Cattle Come to Life
Live cattle futures held gains and closed higher. The strength of cash had
been factored in on Wednesday, leaving little need catch up. Feeder cattle were
not as fortunate being unable to turn the trend higher. Hogs just could not
uncover any buying interest.
DTN Contributing Analyst
Cattle: Higher Futures: Higher Live Equiv: $211.86 -0.73*
Hogs: Lower Futures: Mixed Lean Equiv: $100.44 -0.85*
*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
Live cattle futures benefited from higher cash again Wednesday. Dressed
cattle in the North traded $4.00 higher than last week while Southern cattle
traded $1.00 to $2.00 higher. This certainly gives feedlots confidence to use
the market to their advantage and hold for higher prices. Maybe the premium to
December and February contracts are attainable if packers continue to need
cattle to keep demand satisfied. It is surprising packers were as aggressive as
they were early in the week and despite the weakness of boxed beef. Choice cuts
were down $1.13 with select cuts down $0.85. Weekly exports will either support
the trend higher or limit price potential.
For more free DTN information sent right to your email each morning - click here
to sign up for DTN Snapshot.