DTN Early Word Livestock Comments 08/16 06:30

DTN Early Word Livestock Comments 08/16 06:30 Livestock Futures Will Wait for Cash Direction Trading activity in the cattle complex had little to show in the end as futures showed limited price changes for the week. October hog futures take over as front month Monday after posting a triple-digit loss for week. Robin Schmahl DTN Contributing Analyst Cattle: Higher Futures: Mixed Live Equiv: $238.45 +5.04* Hogs: Steady Futures: Higher Lean Equiv: $133.15 +6.43** * based on formula estimating live cattle equivalent of gross packer revenue. (The Live Cattle Equiv. Index has been updated to depict recent changes in live cattle weights and grading percentages.) ** based on formula estimating lean hog equivalent of gross packer revenue GENERAL COMMENTS: Live cattle had little to go on last week as cash did not perform as anticipated. Feedlots had high hopes of higher cash, but that did not materialize. In fact, cattle trade was limited with packers going through the end of the week with limited volume of cash cattle traded to replenish their supplies. This will make for an interesting week. Feedlots resolved to hold out for higher prices in light of the sharp rise of boxed beef prices. On Friday, choice cuts jumped $6.90 with select cuts up $7.71. The sharp rise of boxed beef over the week, makes one wonder as to the validity of packers holding so tight to their bids without paying even $1.00 or $2.00 higher in order to obtain desired supply when their margins have increased dramatically. It seems they do not want to pay more on the anticipation boxed beef prices will begin to decline in the near future after Labor Day demand wanes. They also may have hoped the bullishness of the WASDE report for grains last week would have resulted in feedlots wanting to move cattle due to the potential of significantly higher grain prices. Cash is anticipated to trade early this week.