Written Commentary
MORNING LIVESTOCK FUTURES OUTLOOK
Pork is cheap compared to beef and going forward, as inflation remains high and food prices remain high, pork will compete with beef.
LIVE CATTLE
There was a higher boxed beef market and over the coming week beef prices will be a key factor for cattle prices. Packers are going to pass on cattle that aren’t finished to their satisfaction. With very little change on June Live Cattle, up 12 cents from last week, and cash prices dropping from $2.00 to $5.00, the wide difference between the cash and futures is indicating cash prices likely have more downside.
LEAN HOGS
Packers are not going to push hogs when the CME Lean Hog Index is only $1.51 below the CME Pork Index. Add in the costs from fixed and variable expense, and buying daily hogs to price of daily pork sales is a loser for a packer. Packers are going to kill hogs and sell pork for contract orders and back down on daily buy. Currently, hog numbers have fallen off and packers may need hogs to fill contracts from the daily buy and sell off cuts that are left over. Pork sales volume is light.
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