DTN Early Word Livestock Comments 01/22 06:25

DTN Early Word Livestock Comments 01/22 06:25 Cattle Futures May Resume Uptrend The cattle complex waited for cash cattle trade to surface and for the numbers on the Cattle on Feed report, which kept trade mixed at the close. Hogs could find little reason to push higher with futures trading in a narrow range. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Higher Live Equiv: $217.53 -$0.54* Hogs: Higher Futures: Mixed Lean Equiv: $95.20 -$0.19** *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: The focus of the trade Friday was the Cattle on Feed report, which has been notorious for at least one surprise. That did not materialize this time as the report was neutral with numbers pretty much right in line with the trade estimates. On feed numbers on Jan. 1 were 102% with the estimate at 102.2%. Placements in December were 95.5% compared to the estimate of 95.4%. Marketed in December was 99.0% compared to the estimate of 99.3%. It is refreshing to see a report in line with the estimates which will leave trading activity to fundamentals rather than knee-jerk reactions. Most of the cash cattle trade last week took place at $173 live and $274 dressed. There were a few live trades at $175, but that was the exception. Boxed beef prices closed lower with choice down $0.79 and select down $0.71. Slaughter should get back on track again, which may result in more aggressive packer demand. The Commitment of Traders report showed the funds reducing their long positions by 901 contracts, bringing their net-long positions to 13,410 contracts. Funds were net buyers of 727 feeder cattle contracts, reducing their net-short position to 1,737 contracts.