DTN Early Word Livestock Comments 05/22 10:18

DTN Early Word Livestock Comments 05/22 10:18 Traders Focus on Fundamentals Cash cattle traded steady to $2.00 higher into the end of last week, which certainly was supportive to the market. The Cattle on Feed report was neutral. Hogs took a beating, pushing to new lows in most contracts despite higher cash and cutouts. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Mixed Live Equiv: $221.53 +$1.44* Hogs: Higher Futures: Higher Lean Equiv: $91.41 +$0.65** *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 futures moved back near the highs again with a few contracts pushing to new contract highs. The final cash trade for the week showed Southern live cattle averaging steady money with last week while Northern dressed cattle were steady to $2.00 higher. Higher cash, even though boxed beef has been struggling over the past few weeks, indicates packers had run short of cattle. They finally needed to step up as feedlots were more intent on receiving no worse than steady cash. Boxed beef prices were higher with choice up $2.79 and select up $0.33. The Cattle on Feed report was neutral with all categories nearly right in line with the average trade expectations. It is uncertain how the market will react to a neutral report as well as the news that an atypical BSE case was confirmed in an older beef cow at a South Carolina slaughter plant. Beef from the animal never entered the food system. This should not impact beef trade. Feeder cattle continued to push to new contract highs as feeder supply is tight and in demand at auctions.