Cattle traded in opposite direction for most of the week as live cattle traded in a back and forth fashion while feeder cattle spent most of the session lower. Technical selling was clashing with expectations that Friday afternoon’s COF report will be friendly. The item that pushed the cattle over the ledge was a late Thursday night or early Friday morning post stating that a deal has been done to significantly lower the price of ground beef. The only way that is possible is to increase imports. The net result was a heavy selloff in the meats Friday morning.
The week started with cattle opening higher with early support coming from technical buying as cattle tried to bounce off support. Bargain hunting was also evident as traded came off the fence to go long after last week’s big selloff. The front month August contracts are starting to go their own direction as they are about to expire and are lining up with the cash trade. Heavy selling pressure hit the cattle around midsession when crude rallied higher, the Dow faded, and the grains pushed higher. The COT report continues to show the funds are trimming their net long position in cattle.
Tuesday’s session had cattle higher across the board with live cattle starting with gains while feeder cattle gapped higher. Feeder cattle retreated quickly but managed to claw back higher only to sell off late in the session. Slowing domestic demand and a sharp increase in supply due to increased imports pressured cattle. Fund long liquidation added pressure. The lack of a cash trade added pressure to the live cattle while feeder cattle were pressured early by spill over pressure from the higher grains.
Live cattle started the session steady to higher on Wednesday while feeder cattle gapped lower on the opening bell. Both managed to stage a small recovery early in the session, but then both faded lower into the close. Technical selling and fund long liquidation took charge around midsession, and the result was another collapse in cattle. The lack of a cash trade and higher grain complex added pressure. Activity was also centered on position squaring ahead of Friday’s COF report.
To close out the week, cattle opened mixed with live cattle steady while feeder cattle were higher. The front month contracts were influenced by cash while technicals influenced the deferred months. The lack of a cash trade pressured the live cattle. Bids were at $223 to $224. A disappointing export sales estimate added pressure. Last week’s sales pace was estimated at 9,299 MT, which was a 5 week low. Feeder cattle also saw pressure from a stronger grains complex. Losses were trimmed by technical buying as cattle have taken a bit hit and are in need of a correction. Activity was also centered on position squaring ahead of Friday’s COF report.
The Douglas AZ border is expected to open to allow for cattle to pass through starting August 24.
The August COF report was friendly to bullish cattle as two of the numbers came out as expected but one was sharply below expectations. The On Feed estimate was as expected coming in at 102%. Placed was estimated at 89%, 4% below expectations. Marketing came in as expected at 93%.
As of August 16, pasture and range conditions were estimated at 23% g/e, 29% fair, and 48% p/vp, down 2% from the previous week.
For the week, Aug live cattle closed at $223.05 down 57.5 cents. Aug feeder cattle closed at $334.75 down $6.075.
Cattle Weekly Comments August 21
Cattle Weekly Comments August 21
Cattle traded in opposite direction for most of the week as live cattle traded in a back and forth fashion while feeder cattle spent most of the session lower. Technical selling was clashing with expectations that Friday afternoon’s COF report will be friendly. The item that pushed the cattle over the ledge was a late Thursday night or early Friday morning post stating that a deal has been done to significantly lower the price of ground beef. The only way that is possible is to increase imports. The net result was a heavy selloff in the meats Friday morning.
The week started with cattle opening higher with early support coming from technical buying as cattle tried to bounce off support. Bargain hunting was also evident as traded came off the fence to go long after last week’s big selloff. The front month August contracts are starting to go their own direction as they are about to expire and are lining up with the cash trade. Heavy selling pressure hit the cattle around midsession when crude rallied higher, the Dow faded, and the grains pushed higher. The COT report continues to show the funds are trimming their net long position in cattle.
Tuesday’s session had cattle higher across the board with live cattle starting with gains while feeder cattle gapped higher. Feeder cattle retreated quickly but managed to claw back higher only to sell off late in the session. Slowing domestic demand and a sharp increase in supply due to increased imports pressured cattle. Fund long liquidation added pressure. The lack of a cash trade added pressure to the live cattle while feeder cattle were pressured early by spill over pressure from the higher grains.
Live cattle started the session steady to higher on Wednesday while feeder cattle gapped lower on the opening bell. Both managed to stage a small recovery early in the session, but then both faded lower into the close. Technical selling and fund long liquidation took charge around midsession, and the result was another collapse in cattle. The lack of a cash trade and higher grain complex added pressure. Activity was also centered on position squaring ahead of Friday’s COF report.
To close out the week, cattle opened mixed with live cattle steady while feeder cattle were higher. The front month contracts were influenced by cash while technicals influenced the deferred months. The lack of a cash trade pressured the live cattle. Bids were at $223 to $224. A disappointing export sales estimate added pressure. Last week’s sales pace was estimated at 9,299 MT, which was a 5 week low. Feeder cattle also saw pressure from a stronger grains complex. Losses were trimmed by technical buying as cattle have taken a bit hit and are in need of a correction. Activity was also centered on position squaring ahead of Friday’s COF report.
The Douglas AZ border is expected to open to allow for cattle to pass through starting August 24.
The August COF report was friendly to bullish cattle as two of the numbers came out as expected but one was sharply below expectations. The On Feed estimate was as expected coming in at 102%. Placed was estimated at 89%, 4% below expectations. Marketing came in as expected at 93%.
As of August 16, pasture and range conditions were estimated at 23% g/e, 29% fair, and 48% p/vp, down 2% from the previous week.
For the week, Aug live cattle closed at $223.05 down 57.5 cents. Aug feeder cattle closed at $334.75 down $6.075.