DTN Closing Livestock Comments

GENERAL COMMENTS

Given moderate trade volume on Wednesday and Thursday, cattle buyers didn't find it necessary to do much shopping Friday. Besides a few scattered sales in several states, the late-week trade was pretty much at a standstill. The National hog base closed off $0.40 compared with the Prior Day settlement ($81.00-$87.50, weighted average $86.40). From Friday to Friday livestock futures scored the following changes: Aug LC Up $3.03; Oct LC up $4.75; Aug FC Up $9.25; Sep FC Up $9.05; Jul LH Up $0.88; Aug LH Off $3.32. Corn futures closed generally six cents higher, supported by late week profit-taking and general production uncertainty. The stock market closed higher with the Dow off 84 points and the NASDAQ better by 38.

LIVE CATTLE

Futures closed higher, up 25 to 82. Moderate gains Friday were supported by short-covering and the reality of cash premiums. After bouncing off 100-day moving averages last week, live contracts managed to rally back toward the highs of June this week. In fact, October and December were successful in closing above 40-day moving averages on Friday. On the other hand, spot August will start next week facing overhead resistance near its 40-day moving average near 119.00. Beef cut-outs: weak to lower (Choice, $209.35 off $0.50, Select $195.42 off $1.84) on light to moderate demand and heavy offerings (74 loads of choice cuts, 55 loads of select cuts, 11 loads of trimmings, 19 loads of coarse grinds).

MONDAY'S CASH CATTLE CALL: Steady to $2.00 higher. Activity on Monday will be limited to the distribution of new showlists. We expect the offering to be steady to somewhat larger. Initial asking prices will probably be around $122-plus in the South and $192-plus in the North

FEEDER CATTLE

Futures closed sharply higher, up 110 to 257. Feeders experienced a very successful week, consistently outperforming their live counterparts. Most contracts closed near the highs of early June and well above 40-day moving averages. The slide in corn prices proved to be supportive with the promise of lower costs of gain. CME cash feeder index: 07/13: $149.74, off $1.00.

LEAN HOGS

Futures closed mostly lower to sharply lower, up 22 to off 262. Despite the fact that soon-to-be-spot August (July expires on Monday) lags far behind the cash index, the late-summer contract continues to attract fairly aggressive selling interest. It would appear that both specs and commercials are beginning to anticipate a major shift toward greater seasonal production. Note that August finished the week below its 40-day moving average. Pork cut-out: $104.48 (FOB Plant) up $0.81. CME cash lean 07/12: $92.84, up $0.09 (DTN Projected lean index for 07/13: $92.78, off $0.06).

MONDAY'S CASH HOG CALL: Steady. Cash hog buyers should resume procurement chores on Monday with basically steady bids.

John A. Harrington can be reached at john.harrington@dtn.com

(AG)

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