Kleist Comments

MORNING MEATS 4/22/14
MORNING MEATS 4/22/14

Add in grains: sold Mexico 240,000t new crop corn.
CATTLE: Cash cattle last week: $146.00 south, $148.-147.00 Neb. and $236.-238.00 dressed; on 118 boxed loads cut outs higher @ up. $2.71 @ $229.06(c)/up. $2.84 @ $218.07(s) on moderate demand; Carcass Equivalent: $216.71 up. $.78.
COMMENTS: Futures firmed up on June’s discount to the live and the expiring April; on sharply higher beef; on light technical support. However, can we buy June JUST because of the discount? Maybe not. With more supplies of fat cattle expected into summer; with the still record beef prices; with the hog bulls now quarrelling over PEDv summer numbers et al, it’s not a given. So let’s say buying breaks lightly for trading turns. If selling, the major m/a’s at $135.37-135.74 a likely area and with a likely bear defense area +$136.15. Cattle-On-Feed Friday, more later.
HOGS:
Interior cash hogs mixed @ dn. $1.02 (e) to up. $1.52 (w), rough avg. $113.00: Pork cut outs fell $1.93 @ $118.47, on bellies/hams/loins. Lean index as of 04/18 @ $119.65 dn. $1.21.
COMMENTS: Cash hogs maybe mixed again as farmer’s retreat to some fields, though that impact has long been minimal. But a talking point perhaps. The June hogs ‘recovery’ seems to be petering out technically and fundamentally. June also is now premium to the lean index and a larger premium to the average interior price. PEDv numbers are being ‘yelled’ as falling off a cliff this summer but in whispers the exact amount and record high wts. PLUS record high pork prices keeping the buying more cautious. The $120.00 area might still have some magic but keep in mind prices falling into major m/a support at $121.72-119.62 and a close under them a likely bull defense near term. I wanted a bigger rally to sell into for trading turns. We’ll see. Open interest fell 1,130 in dribs and drabs per contract amid light-side volume.

Kleist Comments

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

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