DTN Early Word Livestock Comments 02/23 06:20

DTN Early Word Livestock Comments 02/23 06:20 Brazil to Halt Beef Exports to China Live cattle settled back a bit into the close after trading in a price range of less than a dollar. There were no cattle traded Wednesday, leaving packers looking at higher prices again to purchase needed supply. Feeder cattle found greater strength from lower corn prices. Hogs just could not find continued support with futures eliminating much of Tuesday's gain. Robin Schmahl DTN Contributing Analyst Cattle: Higher Futures: Mixed Live Equiv: $213.28 +$0.80* Hogs: Lower Futures: Higher Lean Equiv: $90.27 +$0.04** *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: Even with the current optimism of higher cash prices and strong boxed beef, traders would like to see confirmation of higher prices. A few cattle had traded in Nebraska on Tuesday at $1.00 higher, but so far, feedlots have rejected any bids by packers. Packers are over a barrel with lighter showlists and tightening numbers. Boxed beef was higher with choice up $0.71 and select up $2.80. The possible atypical BSE case that was being tested in Brazil on Wednesday was confirmed as BSE. Even though this form has no risk of spreading to the herd or humans, Brazil is halting beef exports to China beginning Thursday. This is just a precaution and part of the health pact agreed on between China and Brazil. This halt is expected to be temporary, but it will have a significant impact as China is the largest export destination for Brazilian beef. It is unclear whether China will turn to U.S. beef in the interim. That may depend on the duration. The Cattle on Feed report will be released Friday. On feed numbers are estimated at 96.1%, placements at 97.2%, and marketings at 104.0%