DTN Early Word Livestock Comments 07/25 06:18

DTN Early Word Livestock Comments 07/25 06:18 Higher Placements May Have a Negative Influence Cattle futures posted a strong Friday. Lower corn futures and positioning ahead of the Cattle on Feed and Bi-annual Cattle Inventory reports dominated much of trading. August hogs pushed sharply higher, while later contracts were supported, closing with minor gains. Robin Schmahl DTN Contributing Analyst Cattle: Lower Futures: Lower Live Equiv: $197.09 +$0.10* Hogs: Steady Futures: Mixed Lean Equiv: $133.86 +$1.96** *Based on formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. Index has been updated to depict recent changes in live cattle weights and grading percentages.) ** based on formula estimating lean hog equivalent of gross packer revenue. GENERAL COMMENTS: Live cattle were higher due to positioning ahead of the reports Friday. There was anticipation at least one of the reports would be friendly and short-covering pushed futures higher. Traders did see friendly numbers on the Bi-annual Cattle Inventory report with total inventory down 2%. Beef heifers over 500 pounds were down 3% with beef calves under 500 pounds down 3%. This was about as expected, so no real surprises there. The surprise was on the Cattle on Feed report. Placements during the month of June were at 98% of a year ago compared to the trade estimate of 94.7%. Even though on feed numbers and marketings were in line with estimates, higher placements are likely to push futures lower Monday as traders react to the actual versus expectations. Feeder cattle may go along for the ride as they follow the lead of live cattle as well as some negative influence from higher corn futures.