Monday, December 11, 2023  
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DTN Early Word Livestock Comments      12/11 06:26
   Follow-Through Buying May Begin Week

   It was an interesting close to the week with cattle futures showing solid
gains. Lower cash had been factored with traders deciding the discount to cash
was too great. Hog futures found some solid footing, nearly eliminating the
loss of Thursday. Cutouts posted a strong gain.

Robin Schmahl
DTN Contributing Analyst

   Cattle: Steady         Futures: Higher    Live Equiv:   $208.79 -$1.14*

   Hogs: Steady          Futures: Higher    Lean Equiv:  $ 92.82 +$2.00**

   *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.


   Cash cattle followed the pattern of the week with Southern trade averaging
$3 lower and Northern dressed trade $4 lower. Without any further losses,
traders decided the market was overdone due to the discount to cash. This
prompted strong buying interest in futures as the day progressed. The fact that
it was the end of the week also played a part in short-covering as traders
seemed to think the weakness of cash may be nearly finished. There is some
thought cash might be no worse than steady this week. It was good to see the
market show strength despite USDA reducing the 2023 average steer price this
year to $175.55, down $1.75 from November, and the average price for 2024 down
$7.00 from their November estimate at $178.00. Boxed beef was lower in both
categories with choice down $1.83 and select down $0.93. The Commitment of
Traders reports showed funds trimming their long futures positions by 5,802
contracts, bringing their net-long position to 26,889 contracts. Fund sold a
net 640 futures contracts of feeder cattle bringing their net short position to
1,819 contracts.
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