Cattle: Cash cattle last week: $139-141.00 & $221-222.00 dressed. On
66 boxed loads cut outs up. $2.73(c) to up. $1.94(s) on light midday movement. *****LATE: KS. REPORTS $141-142.00 AND $223.00………
Comments: Finally the Feb. contract responds the likely expectation of higher cash cattle again this week by narrowing its discount to the live market from last week. Seeing as we already saw $140.00 live, and reports of $141.00 yesterday, shorts might have decided this battle cannot be won. For now anyway. Repeated sharp moves higher in beef seen equating to repeated sharply higher moves for the live especially as showlists under the previous week led by Nebraska then the south more moderately.
Hogs: Interior hogs early not/est. (W), up. $.16(w); Pork cut outs fell $2.26, led by bellies/hams/loins.
Comments: What, me worry? Futures rally moderately even as pork cut outs takes a hit and little evidence of a cash hog low in place. That suggests the psychology looking for pork to eventually benefit from the beef’s rise. The slightly lower wts. I guess added to the mood.
GRAINS & OILSEEDS:
Corn: Three days after the USDA report, that significant ‘key reversal’ from Friday might get tested. As it is, March corn dangling precariously under and just over its several significant m/a’s. Perhaps the rally was more than a ‘whiplash’, in that post-holiday the market needed some cash corn and it took the rally to get it out.
Soybeans: New swing highs as soymeal again seen leading the soybeans higher. As mentioned, possible rains in Argentina are looking secondary to China’s recent buying. Additionally, a strong December Crush (165.3mln.bu., up 5 mln. on month and record large) added to the current thinking of ‘too much’ disappearance and a need to ration.
Wheat: Showed its true colors again by failing to hold its ‘recovery’. On the world markets, wheat is in a buyers market and sellers are many. Competition undercuts us still at every rally we come up with. Need to change that.