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DTN Early Word Livestock Comments 09/30 06:14
Cash Cattle May Trade Higher This Week
Live cattle showed volatility with the market, spending time both higher and
lower by the same amount. The result showed futures changed little. Hogs were
likely the recipient of short-covering as traders were unwilling to push the
market lower.
Robin Schmahl
DTN Contributing Analyst
Cattle: Higher Futures: Higher Live Equiv: $281.28 +$2.41*
Hogs: Lower Futures: Mixed Lean Equiv: $94.77 -$0.03**
*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:
Live cattle traders played a tug-of-war on Tuesday, with the end result
being futures showed little change. Feeder cattle showed significant volatility
and posted triple-digit gains. With boxed beef prices stronger this week,
traders think cash prices may turn out better than previously thought. Packers
seem to show a willingness to obtain some cattle at least at steady money, if
not higher, as they have already tipped their hand with early bids. Usually,
they wait until later in the week. Boxed beef prices jumped on Tuesday, with
choice up $2.18 and select up $6.25. Feedlots may gain the confidence to hold
for more money this week due to stronger beef prices.
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