DTN Early Word Livestock Comments 01/14 06:13
Limited Livestock Volatility Expected
Cattle futures traded within a fairly tight range Thursday as traders assess
the impact of lower cash, lighter processing and strong boxed beef demand. Hogs
set themselves apart Thursday with higher cash and a potential record increase
in cutouts. However, futures showed limited reaction.
DTN Contributing Analyst
Cattle: Steady. Futures: Mixed. Live Equiv: $211.59 +$1.96*
Hogs: Steady. Futures: Higher. Lean Equiv: $102.17 +$10.82**
*Based on formula estimating live cattle equivalent of gross packer revenue.
(The Live Cattle Equiv. 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.
Trading might exhibit a similar pattern as Thursday for cattle as cash
business is mainly finished for the week. Traders are looking at a three-day
weekend that might influence trading activity Friday. There is a large winter
storm blanketing a large portion of the nation and will impact the movement of
livestock and livestock performance. With some cattle already backing up in the
country, this adds more frustration as increased feeding may not provide any
benefit. We are not even through the end of this week, but the potential for
higher cash next week has already dimmed due to packers contracting for
deferred delivery. Weekly export sales were much better than the previous week
at 9,700 mt. Choice cutouts increased $2.93 with select up $1.78.
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