Cattle Weekly Comments July 5

Cattle Weekly Comments July 5

Cattle started the short week off under pressure but recovered to post strong gains in 2 of the three sessions this week, which was enough to give cattle a strong weekly close.

Cattle started the week under pressure with selling tied to expectation that this week’s cash activity and slaughter runs will he slow due to the 4th of July holiday coming in the middle of the week. Technical selling added to the losses as most of the cattle months are testing highs for the calendar year. Production was suspended at a Cargil beef plant in Dodge City, KS after a partial roof collapse.

Buying showed up on Tuesday as cattle opened the session higher, faltered early in the session, but by midsession buying took hold and cattle never looked back. Expectations for strong demand for beef over the 4th of July holiday helped to give cattle strength as did tight supplies. The lack of a cash trade limited the gains in the front month August. Feeder cattle were supported by a sloppy corn market and from reports of strong cash offers at auction for feedlot ready calves. There are rumors that heifer retention is starting to show up due to improving pastures. This could result in cattle seeing their top sooner than later.

Buying continued midweek with expectations for strong demand for beef over the 4th of July holiday helping to give cattle strength as did tight supplies. Improving cash trade added support. Boxed beef prices were lower today. Beef exports in May were a 4-year low for the month. Futures steep discount to the cash market continues to keep the futures market from falling too much.

As of June 23, pasture and range conditions were down 1% to 47% g/e.

For the week, August live cattle are at $186.425 up $1.00. August feeder cattle were at $261.475 up $2.175.

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