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Morning Livestock Report July 9


The development in the ham market, if it continues today could be the first bit of solid, friendly news for the hog market in a long while. Weekly pork export sales were excellent (it’s not made any difference to futures) at 31,500 MT, up 6% from the 4-week average with Mexico the largest buyer last week, soaking up 9,100 MT followed by China which bought 8,100 MT. Vietnam made their largest purchase ever, taking 2,000 MT last week. Shipments were also excellent at 33,500 MT, up 7% with China receiving 12,700 MT followed by Mexico which took in 10,300 MT. These numbers are solid but they’ve also not made a difference in the face of gross oversupply. So, it’s all up to the ham market to drive the cutout sharply higher. Recommend buying Aug LH puts with no other sell recommendations at this time. From a spec standpoint we have no position. OI in hogs, on the first day of the roll, was down 1300 cars.



I’m picking up conflicting items on the bull/bear debate in LC. There’s some evidence that heavy weight cattle, the serious backlog is being whittled away. However, there’s also evidence that packers, unhappy with margins narrowing each week, are slowing the chain speed. This is not a good time of year for beef demand and the food service sector remains hobbled. So, futures traders fight back and forth. Short term, I’m expecting to see a test of support at 9800 in the Aug. Open interest, on the first day of the roll, was down 8832 with open interest in the Aug dropping by nearly 14K. Corn futures are back up today which should usher in some selling in feeders.


The risk of loss in trading futures and options on futures can be substantial. The author does not guarantee the accuracy of the above information, although it is believed that the sources are reliable and the information accurate. The author assumes no liability or responsibility for direct or indirect, special, consequential or incidental damages or for any other damages relating or arising out of any action taken as a result of any information or advice contained in this commentary. The author disclaims any express or implied liability or responsibility for any action taken, which is solely at the liability and responsibility of the user. This report is a solicitation.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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