Kleist Comments

MORNING MEATS 3/6/14
MORNING MEATS 3/6/14

CATTLE: Cash cattle last week: $150.-152.00, and $240.00 Neb.; on 118 boxed loads cut outs higher at up. $2.75 @ $234.51(c)/up. $1.19 @ $231.93(s) on moderate demand; Carcass Equivalent: $221.33 up. $1.39.

COMMENTS: Cash cattle on light numbers traded $148.00Ks. and $150.000/$240.00 Neb. and Iowa. Weekly export sales fell 5% to 11,500t; 4 del.; open interest fell 2,100 led by April off 10,000 while gaining 7300 in the MQ amid heavy volume. Combined technical suggests major reversals (April just missed a ‘key’ one by a tick). Nonetheless it violated our position defense and now to ponder if the warning about beef yesterday wasn’t all the premature. Aside.

HOGS:

Interior cash hogs mixed @ dn. $1.13(w)/up. $1.04 (e) with rough avg. $102.00; pork cut outs up. $1.12 @ $107.83, led by loins. Lean index as of 03/04 @ $9100.67 up. $1.92.

COMMENTS: Cash hogs higher? Packers packing on the cut outs to support these live prices. I wonder if the “panic” buying is over based on yesterday’s price action. My concern that packers are packing it in the freezers got some help from the weekly pork export sales report falling 27% to 9,500t (China took 400t) but of course Russia’s taste for BLT’s supposedly will correct that and a military incursion into Ukraine not being taken to heart by the bulls as per stopping that. I am always amazed at the ‘touting’ that goes on in these markets, the latest one: PEDV will now effect the kills in MID-MARCH (seeing as it really hasn’t yet though so far the packers seemed to have panicked an that panicked the futures more). Is the panic over? Not sure. but if cash hog prices reach the lofty goals of the summer months (much less the spring months!), between that and beef prices we will be BBQ’ing road kill. No position or even tilt speculatively yet.

This item still in effect from yesterday morning:

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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