Written Commentary
MORNING LIVESTOCK FUTURES OUTLOOK
LIVE CATTLE
Trade volume was very active with volume on August 55,862 contracts. With the strength in the cash cattle market in May, the gain in Choice boxed beef over the past week and having Live Cattle futures discount to cash cattle, the ballistic trading Thursday going from a non-spot month moving into a spot month Monday afternoon was bound to happen. On top of it, cattle weights are down, fewer cattle are grading Choice, slaughter for the year is down and most importantly packers must buy cattle to fulfill the largest percentage of beef moved, previously contracted beef.
LEAN HOGS
Hogs were lower Thursday except for June with June, up likely on shorts getting out. The CME Lean Hog Index is at $79.53 and June Lean Hogs are at $83.55. Of course there are close to 2 weeks before June Lean Hogs expire and spread could remain $4.05 or wider or less. Traders are bull spreading summer hogs but are bear spreading July/August and buying fall and winter hogs.
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