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DTN Early Word Livestock Comments 04/22 06:19
Livestock Futures Remain Supported
Feeder cattle showed more pressure than live cattle Monday as traders
reacted to the higher Cattle on Feed report placements. However, the selling
lacked commitment as the report had been digested. Hogs are slowly creeping
higher as traders have been willing to buy and hold for better pork prices.
Robin Schmahl
DTN Contributing Analyst
Cattle: Steady Futures: Higher Live Equiv: $243.99 +$1.67*
Hogs: Higher Futures: Mixed Lean Equiv: $102.16 -$0.61**
*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:
Traders took a step back in the cattle market Monday as they held back from
aggressive buying, waiting to see further fundamental developments. Feedlots
believe they will be able to obtain more money as the market is strong with
tight supplies. Feeder cattle prices continue to climb as demand is high.
Technical traders may be anticipating prices could move to contract highs,
which then may be a selling opportunity again. However, with the current
bullish mindset, futures could push through the highs, triggering renewed
buying interest. One has to wonder how long consumer demand will remain strong.
Consumers have not reached a threshold for prices. Boxed beef prices closed
higher on Monday, with choice up $2.00 and select up $3.22.
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