Written Commentary
MORNING LIVESTOCK FUTURES OUTLOOK
LIVE CATTLE
Wednesday choice beef was down $2.05. On Monday and Tuesday it looked as though the beef market was turning higher. Feedlots were talking steady to higher cash cattle prices because of it and it looked like beef buyers were beginning to stock up supplies for Labor Day. Wednesday choice primal loins took a big hit to the downside and dropped $11.37.
As summer temperatures decline into fall, cattle feed efficiency will improve. Slaughter will also start to tick up with more cattle expected. There will be more cattle and heavier cattle. Australia and Brazil need to increase beef imports to the US.
LEAN HOGS
The CME Lean Hog Index and CME Pork Index have been steadily falling. Most concerning is the difference with pork prices falling faster than hog prices and cutting packer profit margins. All cash hog negotiated prices are below $90.00. The simple weighted average price is $87.70.
As the summer heat moves to cooler temperatures, weights will increase quickly adding at least 5 to 6 pounds to hogs. Canada is increasing sales to the US.
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