DTN Early Word Livestock Comments 12/16 06:19
Cattle Traders Remain Uncertain Over Cash This Week
Cattle futures were mildly higher with traders supporting the market, but
were uncertain whether cash will be able to hold or increase another week. Hog
futures closed mixed after rejecting significant pressure during the day.
Robin Schmahl
DTN Contributing Analyst
Cattle: Lower Futures: Mixed Live Equiv: $262.82 +$1.64*
Hogs: Higher Futures: Higher Lean Equiv: $104.71 +$0.68**
*Based on the formula estimating live cattle equivalent of gross packer
revenue. (The Live Cattle Equiv. The 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.
GENERAL COMMENTS:
The December and February live cattle contracts were unable to close the
chart gap that had remained below the market. The rest of the live cattle and
all of the feeder cattle contracts closed the lower gap. The higher gaps remain
open and are a likely target in the near term. Fundamentally, the markets were
supported by higher boxed beef prices and tight supplies. However, packers were
able to purchase a significant volume of cattle for deferred delivery, which
may allow them to be less aggressive through the holidays. The boxed beef
prices on Monday showed choice up $2.20 and select up $3.08.
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