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DTN Midday Livestock Comments          08/05 11:37

   Cattle Aim to Close Higher Ahead of Weekend

   With the cash cattle market able to push trade higher this week, both the 
live cattle and feeder cattle contracts are looking to round out the week on a 
stronger note to hopefully propel the contracts higher come Monday.

ShayLe Stewart
DTN Livestock Analyst

GENERAL COMMENTS:

   Heading into the last trading afternoon of the week, the cattle contracts 
are trading fully higher as the market clings to the fact that cash cattle 
traded higher this week. Meanwhile, the lean hog contracts are trading mixed as 
some of the nearby contracts are attempting to break through resistance but 
it's unknown if they'll maintain these levels as fundamental support is touch 
and go this week. December corn is up 5 1/2 cents per bushel and December 
soybean meal is down $15.90. The Dow Jones Industrial Average is down 95.12 
points.

LIVE CATTLE:

   The live cattle contracts are pushing for higher prices heading into 
Friday's afternoon as the market still clings to the fact that cash cattle were 
able to trade higher this week. Thus far throughout the week, Southern live 
trade has traded at mostly $135 to $136, which is steady to $1 higher than last 
week's weighted averages. Northern dressed deals have been marked at mostly 
$225 to $227, which is steady to $2 higher than last week's weighted average 
basis Nebraska. It wouldn't be unlikely to see a little more clean-up trade 
develop ahead of the week's end, but largely the business is done with. The 
week's slaughter is anticipated to be another big one, which helps offset the 
slight pressure from lower boxes. August feeders are up $0.35 at $138.05, 
October feeders are up $0.57 at $144.22 and December feeders are up $0.40 at 
$150.30.

   Boxed beef prices are lower: choice down $1.18 ($265.10) and select down 
$1.08 ($239.27) with a movement of 65 loads (40.45 loads of choice, 11.98 loads 
of select, zero loads of trim and 12.58 loads of ground beef).

FEEDER CATTLE:

   Even as the corn market pushed a $0.06 to $0.09 rally heading into the 
afternoon's trade, the feeder cattle contracts don't seem to care as the nearby 
contracts are pushing gains well over $1.00 higher. This past week was 
incredibly important for the feeder cattle market. With cash cattle prices able 
to trade $0.50 to $2.00 higher, it proves the fact that packers are clipping 
though cattle and running through these supplies faster than originally 
thought. Given that feeder cattle placements have been so high due to drought 
managing practices, feeder cattle buyers needed to see that there was going to 
be better demand for fats, which they began to see this week. As the market 
inches closer to the fall run, feeder cattle demand should only get better and 
has the potential to get extremely strong if the fat cattle market grows 
stronger. August feeders are up $1.02 at $180.22, September feeders are up 
$1.52 at $184.10 and October feeders are up $1.05 at $186.52.

LEAN HOGS:

   The largest currently traded October lean hog contract has broken above the 
market's short-term resistance at $97.50 and is trading higher into Friday's 
afternoon. It's a toss-up at this point how the futures market will close, as 
support is scarce throughout the complex, but both the October and December 
2022 contracts are charging ahead despite cautions elsewhere. The biggest 
things to watch for Friday afternoon will be how the day's estimated slaughter 
and pork cutout values. Pork cutout values have ping-ponged around this week 
and the market would like to see more stable and consistent support. October 
lean hogs are up $0.90 at $98.50, December lean hogs are up $0.15 at $88.77 and 
February lean hogs are down $0.10 at $91.35.

   The projected lean hog index for Aug. 4 is up $0.48 at $122.09, and the 
actual index for Aug. 3 is up $0.67 at $121.61. Hog prices are lower on the 
Daily Direct Morning Hog Report, down $3.37 with a weighted average of $123.67, 
ranging from $115.00 to $135.00 on 5,499 head and a five-day rolling average of 
$125.75. Pork cutouts total 153.14 loads with 134.90 loads of pork cuts and 
18.24 loads of trim. Pork cutout values: down $0.31, $124.49.

   ShayLe Stewart can be reached shayle.stewart@dtn.com




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