DTN Closing Livestock Comments
Cattle Futures Close Mostly Higher in Slow Pre-Holiday Trade
GENERAL COMMENTS
The cash cattle trade was extremely quiet as buyers and sellers seemed more interested in breaking for the long holiday weekend. Week-to-date trade volume totals look no better than mixed, suggesting that some ready cattle will be carried over until Tuesday. The National hog base closed up $0.20 compared with the Prior Day settlement ($58-$64, weighted average $61.95). From Friday to Friday, livestock futures scored the following changes: Oct LC off $1.77; Dec LC off $0.45; Sep FC off $0.20; Oct FC up $0.60; Oct LH off $1.62; Dec LH off $0.90. Corn futures closed 2 cents plus lower, pressured by late-week long-liquidation and profit-taking. The stock market closed higher with the Dow advancing by 39 points and the NASDAQ settling up 6.
LIVE CATTLE
Futures closed mostly higher, up 77 to off 25. At the conclusion of a fairly choppy trade (probably tied to limited trade volume) live issues settled moderately higher for the most part, supported by short-covering and ideas of better beef demand following the holiday. The one exception was new spot October, which closed 25 points lower. Despite the slight loss, the spot month is now showing a slight premium to feedlot cash, something we haven't seen in months. Beef cutouts: weak (Choice, $191.35 off $0.56, Select $190.65 off $0.69) on light-to-moderate demand and offerings (74 loads of choice cuts, 19 loads of select cuts, 19 loads of trimmings, 13 loads of coarse grinds).
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TUESDAY'S CASH CATTLE CALL:
Steady to $2 lower. Tuesday will be slow as packers focused exclusively on the collection of new showlists. While ready numbers could be somewhat larger than this week, short-bought packers could have a bigger appetite given both this week's limited buy and the necessity to secure slaughter needs for the first full week of September.
FEEDER CATTLE:
Futures closed mostly moderately higher, up 15-85. Feeders seem to be supported by late-week short-covering and in the modest premium of the cash index. Trade volume here seemed even lighter than the action seen in the live trade. CME cash feeder index: 08/31: $143.08, up $0.17.
LEAN HOGS:
Futures closed mixed, up 12 to off 17. Activity in the lean market was largely featureless, perhaps nothing more than light short-covering in late-week profit-taking. Although prices improved through the week, few viewed the progress as technically significant. In short, the price trend remains generally negative. Pork cutout: $84.47 (FOB Plant) up $0.89. CME cash lean 08/30: $73.52, off $1.07 (DTN Projected lean index for 08/31: $72.39, off $1.13).
TUESDAY'S CASH HOG CALL:
Steady to $1 lower. Hog buyers should start out bidding steady/weak when trade resumes after the three-day break.
For more from John, see www.feelofthemarket.com
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