DTN Early Word Livestock Comments 06/02 06:18

DTN Early Word Livestock Comments 06/02 06:18 Further Strength Expected The cattle market exploded Thursday as cash cattle traded significantly higher. Once cash trade developed, futures pushed higher, bringing feeder cattle along with it. Hogs showed gains only in June with later contracts lower. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Higher Live Equiv: $224.66 +$0.13* Hogs: Lower Futures: Mixed Lean Equiv: $92.76 +0.41** *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: Traders were anticipating higher cash this week and they got more than they anticipated. Feedlots held out, increasing their asking prices as higher bids were passed during the morning. Packers finally gave feedlots what they wanted, which resulted in Southern live cattle $7.00 to $9.00 higher with Northern dressed cattle $8.00 higher. Price increases such as this are rare but an indication of the tightness of cattle supplies. With cash trading as high as it was, it was surprising live cattle futures did not move higher than they did. Boxed beef prices did not follow the exuberance, closing mixed with choice up $0.60 while select declined $0.83. Feeder cattle struggled for much of the morning before spillover trading began lifting futures. Feeder cattle have been in demand and with live cattle pushing aggressively higher, there was no holding back. Buyers are confident of higher cattle prices, keeping them paying more for feeders.