DTN Early Word Livestock Comments 01/21 06:04
Cattle Futures Fought for Tuesday's Small Gains
Live cattle futures had trouble picking a direction on Tuesday's trade back
from the holiday weekend, closing higher after trading on both sides of the
market. Feeders followed suit despite lower index numbers to start the week.
Robin Schmahl
DTN Contributing Analyst
Cattle: Higher Futures: Higher Live Equiv: $268.08 +$0.15*
Hogs: Steady Futures: Mixed Lean Equiv: $99.25 -$0.73**
*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:
Tuesday was a volatile day of trading for live cattle and feeder cattle
markets after Friday's sharp downward turn. Rumors of New World screwworm bring
uncertainty as more and more cases approach the border. Fundamentally not much
has changed to adjust demand or herd size, but the number of funds investing in
the livestock sector shows how much momentum we have to lose if the big money
gets nervous. The feeder cattle index fell $1.26 Tuesday as a reflection of the
price action seen in the futures market Friday. It is expected to recover some
midweek.
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