GENERAL
COMMENTS: Cattle futures could not maintain the earlier market strength
Friday, resulting in losses for the week with contracts closing near
the lows. This leaves the market in a bearish sideways range. Lean hog
futures followed suit as they were unable to follow-through on the
strength generated this week. Friday to Friday livestock futures posted
the following changes: August live cattle gained $0.38, with October
down $0.48. September feeder cattle down $0.85, with October down $1.72.
October lean hogs gained $4.23, with December hogs up $4.60. Cash
cattle trading finished Friday at $103, down $3 from last week in the
South and around $171, down $4, for last week in the North. Packers held
bids at lower prices seeing no need to raise those bids due to the
negative futures trade. According to the closing National Daily Direct
hogs Friday afternoon report, the base price was $2.14 lower with a
range of $49.00 to $57.50 and a weighted average of $55.78. Corn futures
declined 1 3/4 cents. The Dow gained 41 points with the NASDAQ down 11
points.
LIVE CATTLE: Cattle futures looked very
promising after early losses. However, trading during the final hour
turned ugly with contracts closing lower than Thursday, and the lowest
close since August 19. This certainly did not improve the outlook for
next week. The August contract went off the board with October taking
over posting substantial discount. Boxed beef cut-outs were mixed.
Choice was $0.42 lower at $231.77 and select down $0.51 at $212.27.
There were 35 loads of choice cuts, 14 loads of select cuts, 13 loads of
trimmings, and 11 loads of ground beef.
TUESDAY'S CASH CATTLE CALL: Lower. Packers will
be looking to for more cattle next week, but will bid lower due to the
weakness of cash and futures.
FEEDER CATTLE: Triple-digit losses dominated the
complex as contracts posted the lowest close since August 13. The
impact of the trading after the Tyson fire has keep a very bearish grip
on the market. There is very little bullishness in the market as long as
cash cattle trade lower.
LEAN HOGS: The uptrend for the week remains
intact, but futures could not capitalize on Thursday's strength.
Thursdays gains were eliminated and them some as traders took profits
for the holiday weekend. Spillover weakness came from the cattle as
futures fell during the final hour of trading. Pork carcass values
gained $0.75 increasing to $72.31 per cwt. The CME lean index for 8/28
is $71.24, down $1.39 with the projected two-day index for 8/29 at
$69.45, down $1.79.
TUESDAY'S CASH HOG CALL: Steady to $1 Lower. A
plentiful supply of hogs remain, with packers limiting bids due to
weakness of cutouts. The holiday-shortened week will reduce the
aggressiveness of packers.
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