DTN Early Word Livestock Comments 07/12 06:14

DTN Early Word Livestock Comments 07/12 06:14 Follow-Through Strength Expected in Cattle Cattle found their legs Monday, even though corn closed higher. August rallied to reduce the discount it carried to cash along with hopes that cash will trade steady to higher. Hogs struggled throughout Monday, unable to break through chart resistance without support of cash. Robin Schmahl DTN Contributing Analyst Cattle: Steady Futures: Higher Live Equiv: $197.59 +$0.37* Hogs: Steady Futures: Mixed Lean Equiv: $123.25 +$0.40** *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: The cattle complex opened lower Monday, but steadily found support as corn prices fell back throughout the day. It was similar to watching a balance scale. As corn slipped lower from its highs, cattle moved higher. Overnight corn was lower as traders look ahead to the World Agricultural Supply and Demand report Tuesday at 11 a.m. CDT. The report will not be a market mover for cattle, but it does provide some longer-term direction based on USDA estimates for beef production and prices. Boxed beef was higher Monday with choice up $0.25 and select up $1.15. It is uncertain how aggressive packers may be this week, due to having some already contracted, but slaughter remains brisk, and packers may want to continue to contract ahead if they can obtain supply without having to bid aggressively. The Commitment of Traders report showed funds as net sellers of 9,968 futures positions, bringing their net long to 14,297.