Written Commentary
MORNING LIVESTOCK FUTURES OUTLOOK
LIVE CATTLE
Live cattle settled higher on Tuesday erasing the losses on Monday. Volume was moderate as traders moved futures to within pennies of the past 2 days highs. A positive tone to the market is coming from the boxed beef market. Choice beef was up $1.10 and select was up $.44. Choice was $316.93. A week ago it was $315.81. Strength is coming from the higher rib and loin primals. With beef imports up 19% it could weigh on chuck and round primals. A year ago for labor day these products lead the beef market higher. Beef total movement remains light. Tuesday total movement was 138 loads. Packers are keeping kill down and to keep kill at a minimum. Carcass weights compared to a year ago are up 36.4 pounds and grade is moving higher indicating cattle are staying in the feedlots.
LEAN HOGS
The CME Lean Hog Index and the CME Pork Index have been steadily falling. Most concerning is the difference with pork prices falling faster than hog prices and cutting packer profit margins. All cash hog negotiated prices are below $90.00. The simple weighted average price is $87.70.
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