DTN Early Word Livestock Comments 05/28 06:24

DTN Early Word Livestock Comments 05/28 06:24 Cattle Futures Expected Higher Tuesday The Cattle on Feed report on Friday was somewhat neutral with the numbers near expectations. The strength of cash cattle last week may provide support to the market this week. Hog futures may see some buying interest after the weekend as retail demand may increase to restock pork supplies. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Mixed Live Equiv: $228.59 +$0.58* Hogs: Higher Futures: Higher Lean Equiv: $104.99 +$0.44** *Based on the formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. The 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 futures were higher for the week but coasted into the weekend ahead of the Cattle on Feed report. The report was considered neutral to a bit friendly in the long term. To some extent, this may have been already factored in as futures were higher for the week, but most of the gains were likely due to higher cash cattle trade. However, the numbers will remain tight according to the report. Southern cattle traded $1.00 higher while Northern dressed cattle traded as much as $5.00 higher with the average price in Nebraska reaching an all-time high. It is interesting cattle futures are not at new contract highs even though cash is at a record high. Boxed beef prices were higher with choice up $0.61 and select up $1.64. Fund traders increased their long positions by 7,843 futures contracts on the Commitments of Traders report, bringing their net-long futures positions in live cattle to 49,463 contracts. The funds reduced their net-long futures positions in feeder cattle to 4,204 contacts, a decrease of 207 contracts.