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DTN Early Word Livestock Comments 03/24 06:19
Hog Futures Need to Find Support
Traders digested the Cattle on Feed report and moved forward without
fanfare. Cattle supplies remain tight, and the report does not change that. Hog
futures tried to post gains, but aggressive buying was short-lived.
Robin Schmahl
DTN Contributing Analyst
Cattle: Lower Futures: Mixed Live Equiv: $292.75 -$0.30*
Hogs: Higher Futures: Higher Lean Equiv: $105.56 -$0.40**
*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 bearishness of the placement number on the Cattle on Feed report was not
a concern for traders on Monday, as the focus was on the overall market and not
just a report. The dryness in the Western regions, the wildfires in Nebraska,
and high calf prices do not bode well for herd rebuilding anytime soon. Why
raise them when you can get exceptional prices for calves? A lower showlist of
cattle may mean feedlots are willing to hold for higher prices. Feedlots are
feeding cattle to heavier weights. Boxed beef prices were mixed, with choice
down $0.98 and select up $0.89. The February Cold Storage report will be
released today, showing the level of beef inventory. The March feeder cattle
contract will go off the board on Thursday, with the April contract taking over
as the lead month.
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