DTN Early Word Livestock Comments 02/10 06:13

DTN Early Word Livestock Comments 02/10 06:13 Traders to Cautiously Begin Week Cattle had a tough week last week. Traders will be cautious about stepping into the market aggressively and there is concern that further cash weakness will develop this week. Hog futures held well during the week with the July and later contracts making new highs. Robin Schmahl DTN Contributing Analyst Cattle: Lower Futures: Higher Live Equiv: $236.84 -$1.44* Hogs: Lower Futures: Mixed Lean Equiv: $102.65 +$1.36** *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: It was another difficult week for cattle as futures continued the losses. Cash cattle traded lower for the first time in quite a few weeks. Southern live cattle traded $2.00 lower at $206 with Northern dressed cattle $1.00 lower at $328. Traders expected further weakness in cash as the February live cattle contract is trading over $5.00 below cash. Various news stories last week put pressure on the market, which may increase the desire of feedlots to move cattle rather than risk holding and taking yet lower prices. Boxed beef prices were lower with choice down $2.11 and select down $1.87. Consumer demand may be backing off due to the high beef prices. Feeder cattle prices at some auctions last week were lower in response to the weakness of live cattle. The Commitments of Traders report showed funds selling 4,533 futures in live cattle, reducing their net-long positions to 152,303. The funds sold 946 contracts, reducing their net-long position to 26,781 contracts.