Written Commentary
MORNING LIVESTOCK FUTURES OUTLOOK
LIVE CATTLE COMPLEX
Trade volume was mediocre yesterday. Spreading was the majority of the trade. Live cattle are bear spread, but there may have been a reversal with a key reversal on the February live cattle/April live cattle spread.
The demand for leaner beef is strong as select beef narrows the difference between choice and select. Consumers want beef but they want cheaper beef at this time in November.
LEAN HOG COMPLEX
The CME Pork Carcass Index to the CME Lean Hog Index is widening favoring pork and the negotiated pork price has started to gain. Pork gaining on hogs is positive for packers. Also lean hogs are gaining on live cattle which means lean hog longs are entering the market. Sales of trimmings are also increasing.
Load movement on the daily pork carcass has also increased. Combined with an increase in slaughter this is showing some positive indicators.
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