DTN Early Word Livestock Comments 08/27 11:12

DTN Early Word Livestock Comments 08/27 11:12 Futures May Recover Before Weekend The livestock complex closed in the red Thursday as traders in the cattle complex became disillusioned over cash potential. Hogs continued trading in a sideways pattern with Thursday being the day to sell the market. Friday may be the day to buy again. Robin Schmahl DTN Contributing Analyst Cattle: Higher Futures: Higher Live Equiv: $254.29 +0.99* Hogs: Steady Futures: Mixed Lean Equiv: $123.95 +$6.16** * 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 never really saw the light of day Thursday as futures opened about steady and then spent much of the day in negative territory. The bullishness of the report last Friday has waned with traders seeing declining boxed beef prices as well as limited gains in cash. Cash trade began developing Thursday, but activity was not aggressive. Most cash was about $1 higher, which carries with it some disappointment that higher prices have not been realized. Maybe packers will need to be more aggressive Friday. But, but again, the stage may have been set for the rest of the week, especially with declining futures. Slaughter numbers so far this week are running significantly behind last week and last year. The issue seems not to be tighter cattle supply, but rather ongoing labor shortages as well as mechanical breakdowns. With large margins, packers would want to meet demand with larger numbers, but these issues are ongoing.