MORNING MEATS 6/04/13
CATTLE: Cash cattle last week $124.00-125.00, Neb dressed $200.00.; on 147 boxed loads cut outs: choice dn. $.48 at $206.17, select dn. $1.76 at $185.44 on moderate demand. Carcass Equivalent: $190.09 dn. $.26.
COMMENTS: In some ways, we need to see the live market break hard on top of sharply lower beef prices to get past this impasse with the futures discounts. Yes, in some ways a ‘buy rumor/sell fact’ type of deal. Plus, a big break in beef could re-stimulate consumer demand (assuming retailers pass the lower costs on). So, for now we just trade the futures by feel or charts. Open interest little changed in total, rolling noted out of June into August (Goldmann?), and volume light-side. Showlist estimates: Neb. dn. 6,000; Ks. up 1,000; Tx. up 2,000hd.
Interior cash hogs yesterday mixed at dn. $.47/up $2.94 rough avg. $93.00; cut outs up. $.15 @ $93.95; lean index as of 05/31 at $94.62 up. $.36.
COMMENTS: Cash hogs looking firm early after a surprising jump yesterday in I/M and western interior hog prices, both over $95.00. The pork trade and daily movement loads do not seem to support it but does it matter just yet?
Packers have control over the June index into expiration and why not a squeeze?
We’ll see, Open interest rose 1,396 led by June and August up 3443 combined amid moderate volume…considering the close a ‘mini-battle’ at hand. Not fading this rally yet.