Kleist Comments

MORNING MEATS 3/5/14
MORNING MEATS 3/5/14

CATTLE: Cash cattle last week: $150.-152.00, and $240.00 Neb.; on 85 boxed loads cut outs higher at up. $2.64 @ $231.36(c)/up. $1.93 @ $229.74(s) on light demand; Carcass Equivalent: $219.99 up. $1.46.

COMMENTS: New contract highs as cattle futures catch fire in a seemingly delayed reaction. While I felt I misread Monday’s open interest, the surprise was yesterday it gained it all back and then some being up 4,650 even as April fell 3430 amid strong volume. Well, the discount to the cash et al I mentioned as bullish fell into place courtesy of the funds (and hogs). Upside? Talk is $150.00. My caveat is that beef collapsed last time at $240.00 choice and as per the economy might top out earlier. Just a thought, until then charts rule. Close under $143.80 remains the remaining bull defense.

HOGS:

Interior cash hogs higher @ up. $1.41(w)/up. $1.20 (e) with rough avg. $101.50; pork cut outs up. $1.54 @ $106.31, led by bells, hams & loins. Lean index as of 03/03 @ $98.95 up. $1.67.

COMMENTS: Cash hogs should be higher. One might have though the funds were buying with both hands considering the price action but open interest doesn’t support that right now: Monday off 6,400 and yesterday little changed in total, April off 1940, amid heavy volume (double usual), indicates a major short-squeeze; upside? coin-toss.

One thing: I mentioned that if Russia was lifting its ban March 10th, they would have booked the first ‘tranche’ (so to speak) already. I wonder if the pork trade already has reacted to that. If so, might be ‘buy rumor/sell fact’ scenario. Beware the air.

Kleist Comments

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

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