Kleist Comments

MORNING MEATS 1/28/14
MORNING MEATS 1/28/14

CATTLE: Cash cattle last week: $147.-150.00, Neb. dressed $239-241.00; on 68 boxed loads cut outs higher at up. $.78@ $238.04(c)/up. $.81 @ $237.06(s) on light demand; Carcass Equivalent: $221.96 up. $.60.

COMMENTS: Anything suspicious about beef? Midday yesterday it was quoted up $1.05-$2.37 but closed under that late. Usually it is vice-versus. Another crack in the armor? Cold weather extremes in most cattle areas seems a wild card for traders and helped provide underlying support. Another negative for the economy: durable goods fell 4.3% in Dec. vs. est,’s of up 1.5% (I have covered the U.S. economy time to time and it does not seem able to support these beef prices if grocers start to raise prices accordingly). Open interest rose 1,700 (apparent G/J rolling about even, rest of months up slightly), volume light to moderate. Prices reached into the higher end of my broad support yesterday ($142.70-141.90 Feb.) and recovered slightly. Meats are funny (not ha-ha funny) sometimes as its seems cattle are discounted too much to new-short while hogs seem too premium to new-buy. For me, buying near the money puts especially for hedgers all I wish to do position-wise. Specs should keep a trading affair stance. On the charts: bull pennant or flag forming?

HOGS:

Interior cash hogs lower @ dn. $.63 (w)/ dn. $.65 (e) with rough avg. (w) $78.50; pork cut outs up. $1.50 @ $88.65. Lean index as of 01/24 @ $81.23 up. $.34.

COMMENTS: Cash hogs seen weak in spots. Weather remains a factor as does the bump in cut outs but certainly no overt retailer push to feature, yet anyway. Heard a 2nd. case of PEDv in Ontario; open interest fell 2,900 led by Feb. off 2,780 amid light/moderate volume. New swing highs April but momentum failing? Again tough to buy a premium but a blinded chartist, and computer’s likely, still on bull-course.

Kleist Comments

This is John Kleist, of Kleist Ag Consulting.
Questions? Email me: johnwkleist@sbcglobal.net

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