Live cattle futures were mixed with nearby months posting losses while later months closed slightly higher. Selling pressure remained on feeder cattle due to very strong grain futures. Hogs rallied after being beat down for the previous four days, indicating the liquidation phase might have run its course.
Cattle: Steady. Futures: Mixed. Live Equiv: $194.42 -$0.44*
Hogs: Higher. Futures: Higher. Lean Equiv: $115.62 -$4.08**
*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.
Traders did not know which way to go with live cattle. No cash business was done with no bids or offers placed. There was little expectation for any business Tuesday, but there should be some cash activity Wednesday. Feedlots may have a tough time holding out much longer due to increasing grain prices.
They may be happy with steady bids given the current market situation. If packers see there is a desire to move cattle, they may pull back on bids. Boxed beef continues to erode with choice down $0.83 and select down $1.89. Boxed beef has been declining over the past few weeks nearly on a daily basis as consumers may be shifting to lesser cuts of beef. Slaughter pace is holding well and in line with a year ago.