DTN Closing Livestock Comments

GENERAL COMMENTS

Cash cattle activity was limited to the distribution of new show lists. The offering is mixed (i.e., larger in Texas; smaller in Kansas, Nebraska and Colorado), but generally smaller than the previous week. According to the closing report, the national hog base is $0.12 higher ($82.00-88.50, weighted average $86.43). Corn futures jumped nearly a dime, jazzed by hot and dry forecasts. The stock market settled on a mixed basis with the Dow off 5 points and the Nasdaq up 23.

LIVE CATTLE

Most live issues settled moderately lower (i.e., off 27 to 95) with just a few far deferred contracts closing with very modest gains. The index roll is beginning and that partially explains why spot August caught most of the selling heat. The reality of the dog days of summer could also make it tough for the board to recruit new longs over the next several weeks. Beef cut-outs: mixed, up $0.16 (select, $202.67) to off $1.30 (choice, $217.54) with light to moderate demand and moderate to heavy offerings (75 loads of choice cuts, 34 loads of select cuts, 7 loads of trimmings, 18 loads of ground beef).

TUESDAY'S CASH CATTLE CALL: Steady to $2 lower. Action on Tuesday is expected to remain very slow with bids and asking prices poorly defined.

FEEDER CATTLE

Feeders settled 20 to 80 points, checked by follow-through selling and spillover defensiveness from the live market. Also, would-be buyers must have seen today's surge in corn prices as somewhat sobering. On an estimated run of 5,500 head (near even with June 26, but down from 8,031 last year), feeder steer and heifers sold steady to $2 lower the two weeks ago. CME cash feeder index: 07/07: 149.98, up 1.79.

LEAN HOGS

Lean prices settled mixed, ranging from 47 higher to 122 lower. While soon-to-expire July was held close to the cash index, August and October were hammered by triple-digit losses, thanks to bear spreading or bull spreaders taking profits. Carcass value held about steady as strength in hams and bellies virtually offset weakness in fresh cuts. Pork cut-out: $104.93, off $0.03. CME cash lean index for 07/06: 92.46, up .06 (DTN Projected lean index for 07/07: 92.46, unch).

TUESDAY'S CASH HOG CALL: Steady to $0.50 higher. Opening bids in Tuesday cash hog market should be steady/firm thanks to decent processing margins and seasonally tight market numbers.

For more from John, see http://www.feelofthemarket.com/…

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