CATTLE: Cash cattle last week: $139.-140.00, Neb. dressed $221-22.00; on 75 boxed loads cut outs higher at up. $1.96 @ $216.94(c)/up. $3.18 @ $214.76(s) on light demand; Carcass Equivalent: $204.80 up. $1.86. Record high beef prices.
COMMENTS: Tale of Two Cities: heard a report of a $141.00 live sale yesterday while futures extends its discount to the cash; Select and Choice beef prices narrowing sharply, spitting difference to even, as retailers panic into hamburger? Feb. cattle posted a bull-warning flag yesterday if buying breaks; I will maintain a likely bull defense a move/close under $135.65. Again, why is my heart not into this supply bull? Big fears of a demand bear if retailers ‘pass along’ those prices. Open interest fell 1,300 led by Feb. off 9500 amid good volume.
Interior cash hogs mixed @ dn. $.58 (e)/up. $.90 (w) with rough avg. $77.00; pork cut outs dn. $1.12 @ $82.34. Lean index as of 01/12 @ $81.05 up. $.11.
COMMENTS: Cash hogs called steady-ish early. Charts are a battle ground but slipping again to the downside. While I am neutral on here, there’s not much to attract me to probing the longs side yet. Also, a ‘mini head & shoulders’ forming? Major m/a’s come in at $85.82-85.98 (April $92.07-92.17). Open interest fell 1700 led by Feb. off 7500 amid good volume. One bright spot? At some point there might be a strong retail swing to pork and these prices might continue last week’s strong weekly export sales.