Written Commentary
MORNING LIVESTOCK FUTURES OUTLOOK
LIVE CATTLE
Beef prices have been dropping and exports have been dismal. Consumers have been and still are looking to reduce costs and have been buying lower grade beef and lower priced beef. For the consumer, with the droughts, there has been more lower grade beef. Since Labor Day carcass weights have also been increasing adding more beef. Markets remain bear spread.
LEAN HOGS
The daily cutout continues its slow methodical move down as do cash hog prices. For the producer it is negative with both going down. However, for the packer with hog prices going down at a faster pace than pork prices, it is positive. Packers are going to kill enough hogs to keep their profitable margins. Moving too much pork to daily sales is negative for packers and with contract hogs being cancelled, unless pork prices rise, packers need to lower hog prices.
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