DTN Early Word Livestock Comments 02/02 06:13
Livestock Markets Search for Support
The cattle market did what a market many times does when a report has
already been factored in with buy-the-rumor, sell-the-fact action. Feeder
cattle felt the brunt of the selling. Hogs were in trouble from the start as
technical selling erupted and futures fell to support.
DTN Contributing Analyst
Cattle: Steady Futures: Mixed Live Equiv: $198.02 -$0.55*
Hogs: Steady Futures: Higher Lean Equiv: $86.76 -$1.30**
*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.
Cattle did not find the buying interest many had anticipated. The Cattle
Inventory report had already been factored in, leaving the market looking for
any indication of cash trade. That did not develop Wednesday as packers have
not shown any bids. Boxed beef prices were lower with choice down $1.02 and
select down $0.14. Boxed beef strength is the indicator to watch, moving
forward as it has not performed very well so far this year. The Federal
Reserved raised the interest rate a quarter point, which may have extended
impact on demand. Weekly export sales will be released Thursday morning, likely
having an impact on trade direction.
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