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DTN Early Word Livestock Comments 10/04 06:17

4 Oct 2022
DTN Early Word Livestock Comments 10/04 06:17 Follow-Through Buying May Continue Livestock futures were able to find buying interest with contracts posting some nice gains. This was not enough to turn the trend higher, but it may indicate a bottom may have been reached for the time being. Markets needed to correct from an oversold condition. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Higher Live Equiv $182.24 +$0.38* Hogs: Higher Futures: Higher Lean Equiv: $107.70 +2.27** * 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: Cattle had a fire lit under them with futures posting some nice gains. Futures are trying to correct from an oversold position but have so far not made much progress. A least there was some strength, which may bring more buyers into the market. There was no cash activity Monday as usual, but there is hope that packers may need to buy cattle more aggressively this week. It was positive to see boxed beef closing higher in both categories. Choice gained $2.19 while select increased $1.18. We must exercise caution as one day of gains for boxed beef does not indicate a change in trend. Packers want to see margins improve and they may not be very willing to pay higher money for cattle because of a positive start to the week. The Commitment of Traders report showed funds as net sellers of 11,148 contracts bringing their net-long positions to 62,075 contracts. Feeder cattle futures bounced likely due to an oversold market and the beginning of a new month and new quarter.