Written Commentary
MORNING LIVESTOCK FUTURES OUTLOOK
LEAN HOGS
Lean hog trade volume was light Tuesday. April through October Lean Hogs are at premiums to current cash with April $6.44 over the CME Lean Hog Index and June $19.86 over it. Pork has two strong positives. Pork is cheaper than beef and there is a plentiful supply. Retailers can offer pork with low pricing to the consumer and maintain profit margins. The pork carcass continues to move up. February has seen best advancements in the carcass from butts, ribs and hams.
LIVE CATTLE
Fires are burning across the panhandle of Texas. Expect cash cattle trading to develop late this week. Packers have cut kill to keep from paying up for cattle and they will buy only enough cattle to fill beef orders. There are fewer cattle and with fewer cattle it is usually supportive for higher cattle prices. But with packers cutting slaughter, they intentionally are curbing the need for cattle. Slowing slaughter puts less beef on grocery store shelves. At the same time consumers want cheaper beef. Consumer demand is going to be the reason cattle prices will go higher or turn away from higher prices.
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