DTN Early Word Livestock Comments 08/25 06:20

DTN Early Word Livestock Comments 08/25 06:20 Uncertain Demand Impacts Futures Selling pressure in the livestock complex Tuesday resulted in futures slowly grinding lower. Even with that, cattle did perform better than hogs. Boxed beef and pork cutouts will be the driving factor of market direction. Robin Schmahl DTN Contributing Analyst Cattle: Higher Futures: Mixed Live Equiv: $253.90 -$0.68* Hogs: Steady Futures: Mixed Lean Equiv: $118.56 -$2.25** * 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: After live cattle futures made new highs Tuesday selling pressure got the upper hand, moving prices back down and both August and October ended with losses. It seemed to be a matter of the market overreacting to the Cattle of Feed report with buying interest running its course. Later contracts closed higher with the anticipation of tighter cattle supplies down the road and the desire to add premium to deferred contracts. Boxed beef prices declined after a multiple week surge of prices. Choice cuts were down $0.45 with select cuts down $2.50. This could be the turn in trend that had been anticipated as Labor Day draws closer. Some asking prices surfaced Tuesday higher than last week's trade, but no bids from packers. Even though boxed beef prices had been surging and cattle supplies may tighten, weakness of boxed beef may limit packer willingness to pay higher. Feeder cattle came under pressure as a reaction to stronger grain prices.