Morning Livestock Report, 12/29/2015

Tuesday, December 29, 2015

Despite the winter weather seen over the weekend in the Panhandles and into IA yesterday, the cattle markets traded lower for most of the session yesterday, finishing with relatively minor 25-90 point losses in the fats and 40-115 point losses in the feeders. It’s arguable how much (or maybe all?) of the storm was priced into last week’s sharp rally and now futures again find themselves holding a giant lead on last week’s $122-124 cash cattle trade. Most expectations for this week’s cash trade seem to be in the ~$130 area, with packers finally again buying for a full slaughter week next week and a spot boxed beef market that has some real upside momentum going. Both the choice and select cutout indexes were up $3-4 yesterday and are a quick $10 off their lows of a week ago, with some analysts expecting an additional $10 this week as the holidays interrupt production efforts. Weather and transportation problems further contributing to the reduced slaughter with yesterday’s total coming in at just 90K head, compared to 111K head the prior Monday.

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