CATTLE â€” ANALYSIS â€” Last week, live cattle closed $3.25 lower while feeder cattle closed $4.92 lower. Last week, Last week, cash trade in the South developed at $138, $3 lower compared to the previous week. Trade in the North was $218, $5 lower when compared to the previous week. Feeder cattle were $2-$4 lower. Cattle traded lower on softer cash trade expectations and a decrease in boxed beef values that has reduced packer margins to near breakeven. On daily charts, the retracement appears to have a reached a 50 percent correction, and while a 62 percent or even a 75 percent correction can not be ruled out, prices are likely to recover into the summer on improved demand, both domestically and exportable demand. The Cold Storage report showed beef in storage is down slightly at 490,575 million lb, last months was 518,136 million lbs.
STRATEGY & OUTLOOK
The large supplies of cattle are already priced into the market. Prices feel like they should move higher into the summer. Producers with cattle to market this fall should look for hedging opportunities. Feed costs for 2016 should be locked in.
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