DTN Early Word Livestock Comments 08/31 06:25

DTN Early Word Livestock Comments 08/31 06:25 Final Trading Day for August Cattle Feeder cattle were the only bright spot Monday as they received some support from declining grain prices. Live cattle were under pressure led by the drop of August. Hogs tried to extend gains but succumbed to underlying fundamental pressure. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Mixed Live Equiv: $259.76 -1.83* Hogs: Steady Futures: Higher Lean Equiv: $117.37 -6.87** * 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 showed spillover pressure from the weakness of the August contract that will cease trading Tuesday. October will then move to front month and is holding a premium to cash. Unless cattle supplies tighten and demand remains strong, some premium might erode out of the market over time. Although the report a week ago showed a trend of lower cattle supplies, traders seem convinced demand will slow, and beef supply will be sufficient. Packers have not been very anxious to pay more for cattle despite high boxed beef prices. Now that boxed beef is declining, it may be more difficult to see higher cash. Choice cuts fell $2.56 with select cuts down $2.97. The prospect of higher cash may be dimmed due to the upcoming holiday weekend. The Commitment of Traders report showed funds were net buyers of 21,876 futures contracts moving their net-long positions to 92,649 contracts.