September 11, 2008
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
The cash fed cattle market was quiet again yesterday as packer bids of $97 in the south and $95/$1.51-$1.52 in the north remain dollars apart from feedlot offering prices of $102 live and $1.62 dressed. There were some cattle trading for $1.51-$1.52 dressed in western Iowa and eastern Nebraska late Tuesday afternoon, however numbers looked light. The sale barn cattle were lower yesterday, with Sioux Falls and Yankton, SD calling their markets $1-$2 lower on the beef fats with $92-$93 tops being noted. The Holstein steer top was quoted at $83-$85, and here too, that market was being called $1 lower. The fed cattle market certainly isn’t shaping up to be what I thought it was going to be this week. While the beef has been holding together fairly well the first part of this week, the futures market hasn’t and has been subject to more liquidation along with the rest of the commodity complex. I am still of the opinion that we should be able to trade cash cattle at steady money this week, and let the futures clear some of the extreme premium out of the market that it has been carrying for the last several months, and we’ll be alright going forward. But when you get the futures capitulating like they have been, everyone’s psychology turns negative and they think they should accept lower packer bids for their cattle. It certainly seems like the northern fed market is going to have a hard time rallying, or even holding steady this week as packers in that part of the country cite they have ample supplies of contract and formula cattle to work through, and there are plenty of cattle showing up in the country in states like SD, MN, WI, IA, and NE, more than what we thought would be around for this time of year. The market is still in good shape going forward from a supply standpoint, and Canadian fed cattle imports have backed off quite a bit, all of which is going to be supportive towards the end of September and going through October and November. However, it is quite apparent the market has some issues to work through in the next week or so, and this is going to keep rally potential at bay. I would now look for a two-tiered market to develop this week with lower money in the north and stead to slightly lower in the south. Cash feeder cattle markets continue to trade along mixed line, with some sales reporting steady to lower and others reporting steady to higher. We are getting into the yearling run of cattle coming off of grass in the northern plains sale barns, and the market is actually holding up fairly well. There were several strings of 9 weight cattle in Phillip, SD Tuesday that were still bringing $104-$109, despite that market being called $2-$5 lower. The slaughter cow market is holding up a little better this week with many sales reporting steady to higher. The bulk of your better yielding cutter and boner cows bring $53-$63. We are probably close to seeing the best of the slaughter cow market for the rest of the year in the next couple of weeks.
Cash Beef Situation and Outlook:
Yesterday’s cattle kill was estimated at 128,000 head, which would be even with a week ago, and 1,000 head above the same day a year ago. The week-to-date kill is estimated at 382,000 head, which would be 123,000 head above the same period last week, with the industry looking for a 665,000 head production week. The boxed beef market was higher yesterday with the choice cutout closing $.24 higher to settle at $160.09 and the select cutout closing $1.44 higher to settle at $153.91. Sales volume was good with 463 loads of beef sold (200.67 loads of choice fab cuts, 139.26 loads of select fab cuts, 45.65 loads of trim, 77.05 loads of grinds). The choice/select spread settled at $6.18 a loss of $1.20.
The beef market was mostly higher yesterday on renewed export interest on chuck items, in particular chuck rolls. Middle meats held mostly steady yesterday and it was said that interest for rib and loin cuts into the end of this month and October was picking up. The round complex of the beef carcass was lower as a lack of Russian business keeps values there under pressure. There was good sales volume yesterday as buyers are more willing to take on extra product at current price levels. Boneless beef markets were mostly steady yesterday as supply and demand were in balance. The beef market feels in pretty good shape and I would continue to look for steady to higher prices going into next week. Beef exports for the week of August 29-September 4, 2008 are as follows:
Beef: Net sales of 6,500 MT were primarily for South Korea (3,600 MT), Canada (1,400 MT), Mexico (800 MT), Japan (300 MT), Taiwan (200 MT), and Hong Kong (200 MT). Exports of 12,100 MT were mainly to Mexico (4,500 MT), South Korea (3,000 MT), Canada (1,300 MT), Russia (900 MT), Japan (900 MT), Vietnam (800 MT), Taiwan (300 MT), and Hong Kong (200 MT).
Futures Market Situation and Outlook:
October live cattle settled at $101.65 a loss of $1.00, December live cattle settled at $103.02 a loss of $1.10, and the February live cattle settled at $104.67 a loss of $1.12. In the feeder cattle, September feeder cattle settled at $109.85 a loss of $1.00, October feeder cattle settled at $108.90 a loss of $1.52, and the November feeder cattle settled at $108.67 a loss of $1.07. The reported CME feeder cattle index for 9/9/08 was $111.57 a loss of $.33.
Yesterdays live cattle volume saw 40,221 contracts trade in the pit and 23,787 contracts trade on Globex. Live cattle open interest declined 763 contracts to come in this morning at 271,498. Yesterday’s feeder cattle volume saw 6,635 contracts trade in the pit and 1,518 contracts trade on Globex. Feeder cattle open interest declined 486 contracts to come in this morning at 27,402.
It was another day of liquidation in the cattle market as technical’s and outside market influences weighed on futures values. The “Goldman Roll” continued yesterday with an estimated 8-10,000 contracts of live cattle moving into deferred months and 1,000-2,000 contracts of October feeder cattle moving into November. Technically the market has taken out several areas of support and I don’t see anything to support the futures now except for short covering and hedge lifting. From a fundamental standpoint I think we are getting close to a near term bottom as fed cattle supplies remain manageable and the beef market is in pretty good shape. Where exactly the low in the futures is at remains to be seen yet as it is hard to pick a bottom in a liquidating market. I would say off the top of my head though that we could easily see another $1-$2 lower in the live cattle futures and $3-$4 lower in the feeder cattle futures. Look for another lower start to futures trading this morning, with the market firming up a bit once we get a better handle on the southern fed cattle trade. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Vetterkind Cattle Brokerage, LLC
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Thursday, September 11, 2008
Wednesday, September 10, 2008
September 10, 2008
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
The cash fed cattle market went untested again yesterday as packer demand for the first of the week is light. Most of the major beef packing companies cite ample supplies of contract and formula cattle for the first part of September and as such are in no hurry to bid for any cattle. If you were to call in and ask for a bid they would probably shoot you $97/$1.54. To begin the week, cattle feeders have a mostly steady to slightly smaller showlist offering priced at $102 live and $1.62 dressed, and so the standoff continues. I wouldn’t imagine that we would see any meaningful trade develop before Thursday at the earliest. There isn’t a lot of fresh news to influence the market one way or the other, which makes predicting this week’s price action a little difficult. There are certain spots throughout the country where ample numbers of fed cattle are available this week, the upper Midwest in particular and this will keep northern packers bidding the market lower where applicable. The futures act good one day, and look weak the next day, so it’s hard to get a good feel there. We could trade cattle steady this week and the futures wouldn’t have to do anything, as a matter of fact they could sell off in an attempt to further narrow the wide basis. I am still of the opinion that the market could trade steady this week, however much is going to depend on how well the beef moves throughout the week and what the futures do. While beef packers may have a lot of contract cattle to work through for the first part of this month, numbers are still slated to tighten towards the end of September on through October and November, which is going to be long term supportive. For now I will still call for a mostly steady fed cattle trade with a chance of being higher.
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 127,000 head, which would be 1,000 head below last week and even with the same day a year ago. The week-to-date kill stands at 254,000 head, which would be 123,000 head below last weeks holiday shortened production week. I will look for a 665,000 head production week. Due to a computer problem at USDSA there was no boxed beef report yesterday. However, private sources indicated a mostly steady to slightly firmer undertone. Chuck cuts, in particular chuck rolls were trading at higher money on renewed export business. Round items were under a little pressure and middle meats were steady to a little softer. Look for steady to higher by the end of the week in the beef market.
Futures Market Situation and Outlook:
October live cattle settled at $102.65 a loss of $.40, December live cattle settled at $104.12 a loss of $.82, February live cattle settled at $105.80 a loss of $.52. In the feeder cattle pit, September feeder cattle settled at $110.85 a loss of $.45, October feeder cattle settled at $110.42 a loss of $.87, and the November feeder cattle settled at $109.75 a loss of $.62. The reported CME feeder cattle index for 9/8/08 was $111.90 a loss of $.46.
Yesterdays live cattle volume saw 36,502 contracts trade in the pit and 19,467 contracts trade on Globex. Live cattle open interest gained 1,218 contracts to come in this morning at 272,352. Yesterday’s feeder cattle volume saw 5,767 contracts trade in the pit and 709 contracts trade on Globex. Feeder cattle open interest declined 418 contracts to come in this morning at 27,901.
The futures took it on the chin yesterday as sharply lower hogs, outside markets, and general concerns over a faltering U.S. economy weighed on contract values. Technically the market looks vulnerable to further downside as we continue to have too big of premiums built into the futures and the entire commodity complex as a whole seems to be liquidating. The “Goldman Roll” continued yesterday with an estimated 8-10,000 contracts of October live cattle rolled into December and 2,000 contracts to October feeder cattle rolled into November. Options have been busy the last couple of days, with heavy call option buying noted in the live cattle market. Much of this appears to be the covering of short call positions initiated several weeks ago near the highs of the market. Option volatilities have gotten pretty cheap at 13%-15% over the last couple of weeks in both calls and puts, and option premium should be owned at current levels and not sold. Also, short future hedges should be moved into put options to take advantage of the decline in option premium and guard against an unforeseen rally in futures. For today we will likely open a little lower in the futures. Support for October live cattle will come into place at $102, and below that the $100-$101 area looks probable. December live cattle will have some near term support at $103.50 and below that $102-$103 looks probable. Feeder cattle futures will have some support at $109-$109.50 basis the October contract, below that $104 seems probable. Look for a $.10-$.20 lower open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Vetterkind Cattle Brokerage, LLC
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
The cash fed cattle market went untested again yesterday as packer demand for the first of the week is light. Most of the major beef packing companies cite ample supplies of contract and formula cattle for the first part of September and as such are in no hurry to bid for any cattle. If you were to call in and ask for a bid they would probably shoot you $97/$1.54. To begin the week, cattle feeders have a mostly steady to slightly smaller showlist offering priced at $102 live and $1.62 dressed, and so the standoff continues. I wouldn’t imagine that we would see any meaningful trade develop before Thursday at the earliest. There isn’t a lot of fresh news to influence the market one way or the other, which makes predicting this week’s price action a little difficult. There are certain spots throughout the country where ample numbers of fed cattle are available this week, the upper Midwest in particular and this will keep northern packers bidding the market lower where applicable. The futures act good one day, and look weak the next day, so it’s hard to get a good feel there. We could trade cattle steady this week and the futures wouldn’t have to do anything, as a matter of fact they could sell off in an attempt to further narrow the wide basis. I am still of the opinion that the market could trade steady this week, however much is going to depend on how well the beef moves throughout the week and what the futures do. While beef packers may have a lot of contract cattle to work through for the first part of this month, numbers are still slated to tighten towards the end of September on through October and November, which is going to be long term supportive. For now I will still call for a mostly steady fed cattle trade with a chance of being higher.
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 127,000 head, which would be 1,000 head below last week and even with the same day a year ago. The week-to-date kill stands at 254,000 head, which would be 123,000 head below last weeks holiday shortened production week. I will look for a 665,000 head production week. Due to a computer problem at USDSA there was no boxed beef report yesterday. However, private sources indicated a mostly steady to slightly firmer undertone. Chuck cuts, in particular chuck rolls were trading at higher money on renewed export business. Round items were under a little pressure and middle meats were steady to a little softer. Look for steady to higher by the end of the week in the beef market.
Futures Market Situation and Outlook:
October live cattle settled at $102.65 a loss of $.40, December live cattle settled at $104.12 a loss of $.82, February live cattle settled at $105.80 a loss of $.52. In the feeder cattle pit, September feeder cattle settled at $110.85 a loss of $.45, October feeder cattle settled at $110.42 a loss of $.87, and the November feeder cattle settled at $109.75 a loss of $.62. The reported CME feeder cattle index for 9/8/08 was $111.90 a loss of $.46.
Yesterdays live cattle volume saw 36,502 contracts trade in the pit and 19,467 contracts trade on Globex. Live cattle open interest gained 1,218 contracts to come in this morning at 272,352. Yesterday’s feeder cattle volume saw 5,767 contracts trade in the pit and 709 contracts trade on Globex. Feeder cattle open interest declined 418 contracts to come in this morning at 27,901.
The futures took it on the chin yesterday as sharply lower hogs, outside markets, and general concerns over a faltering U.S. economy weighed on contract values. Technically the market looks vulnerable to further downside as we continue to have too big of premiums built into the futures and the entire commodity complex as a whole seems to be liquidating. The “Goldman Roll” continued yesterday with an estimated 8-10,000 contracts of October live cattle rolled into December and 2,000 contracts to October feeder cattle rolled into November. Options have been busy the last couple of days, with heavy call option buying noted in the live cattle market. Much of this appears to be the covering of short call positions initiated several weeks ago near the highs of the market. Option volatilities have gotten pretty cheap at 13%-15% over the last couple of weeks in both calls and puts, and option premium should be owned at current levels and not sold. Also, short future hedges should be moved into put options to take advantage of the decline in option premium and guard against an unforeseen rally in futures. For today we will likely open a little lower in the futures. Support for October live cattle will come into place at $102, and below that the $100-$101 area looks probable. December live cattle will have some near term support at $103.50 and below that $102-$103 looks probable. Feeder cattle futures will have some support at $109-$109.50 basis the October contract, below that $104 seems probable. Look for a $.10-$.20 lower open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Vetterkind Cattle Brokerage, LLC
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Monday, September 8, 2008
September 8, 2008
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
We left last week with a fed cattle market that trades $1-$2 lower early and steady to $.50 higher late. Moderate numbers of fed cattle traded in Nebraska at $97 live and $1.55 dressed on Thursday. Cattle feeders on the southern plains that were determined to get at least steady money held out and were rewarded Friday afternoon, as trade developed at $99 live and $1.56 ½ dressed in Texas and Kansas, with packers paying $99-$99.50 live for cattle in western Nebraska and Colorado on Friday afternoon as well. All in all, it wasn’t a bad trade in the south and it looks as though movement was adequate in all trading areas. As fed cattle numbers get tighter in the next couple weeks and we see beef demand pick up a bit, I think we will see the fed cattle market hold together and trade higher in the coming weeks. I will call for at least steady money on this weeks fat cattle market by the end of the week. Last week saw a mostly steady feeder cattle market as the holiday curtailed movement on the week. Many feeder sales were actually reporting higher transactions by the end of the week and I will expect to see a mostly steady to slightly lower market early this week. Slaughter cows were mostly lower last week as more and more numbers show up in the western sale barns.
Cash Beef Situation and Outlook:
Last weeks cattle kill was estimated at 590,000 head, which was 90,000 head below the previous week and 16,000 head below the same week a year ago. The boxed beef market was $2.58 lower on the choice cutout and $1.94 lower on the select cutout on increased movement. Friday saw a mixed beef trade with the choice cutout closing $.11 lower to settle at $158.30 and the select cutout closing $.05 higher to settle at $152.05. Sales volume was good with 341 loads of beef sold (139.92 loads of choice fab cuts, 113.08 loads of select fab cuts, 31.84 loads of trim, 55.81 loads of grinds). The choice/select spread settled at $6.25 a loss of $.16.
The main theme in the beef market last week was packers getting into a better sold position on their beef inventory. And it worked as they offered discounts, primarily on middle meats for the first part of the week, which in turn enticed buyers back into the market. We saw load counts go up and movement for the week was described as very good. This will allow packers to raise prices early this week in an attempt to cover higher live inventory costs. Export demand to Asia remains supportive to the market and we will see our domestic demand begin to pick up in the coming weeks. All of which is going to be supportive to prices going forward. I will call for a steady to higher beef market for the first part of this week.
Futures Market Situation and Outlook:
On Friday October live cattle settled at $102.95 a loss of $.35, December live cattle settled at $104.95 a loss of $.35, and the February live cattle settled at $105.80 a loss of $.30. In the feeder cattle pit, September feeder cattle settled at $111.12 a gain of $.35, October feeder cattle settled at $110.67, and the November feeder cattle settled at $110.22 a gain of $.25. The latest reported CME feeder cattle index was $111.98 a gain of $.33.
Futures spent most of the first part of last week trading lower as wild gyrations in the grain market, talk of export disruptions to Mexico and Russia, and ideas the cash markets were going to be lower all weighed on values. I thought the market actually held together fairly well on Friday as we had live cattle futures on the ropes early, however once the market realized we were going to trade $99 cattle on the southern plains, we saw a pretty good short covering rally. There was some very good buying in October live and feeder cattle futures on Friday morning at there lows, and I think this buyer support will spill over into the first part of this week. If we get some follow though buying early today in the live and feeder futures I think it could end up being a positive week. Look for a $.10-$.20 higher to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Vetterkind Cattle Brokerage, LLC
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
We left last week with a fed cattle market that trades $1-$2 lower early and steady to $.50 higher late. Moderate numbers of fed cattle traded in Nebraska at $97 live and $1.55 dressed on Thursday. Cattle feeders on the southern plains that were determined to get at least steady money held out and were rewarded Friday afternoon, as trade developed at $99 live and $1.56 ½ dressed in Texas and Kansas, with packers paying $99-$99.50 live for cattle in western Nebraska and Colorado on Friday afternoon as well. All in all, it wasn’t a bad trade in the south and it looks as though movement was adequate in all trading areas. As fed cattle numbers get tighter in the next couple weeks and we see beef demand pick up a bit, I think we will see the fed cattle market hold together and trade higher in the coming weeks. I will call for at least steady money on this weeks fat cattle market by the end of the week. Last week saw a mostly steady feeder cattle market as the holiday curtailed movement on the week. Many feeder sales were actually reporting higher transactions by the end of the week and I will expect to see a mostly steady to slightly lower market early this week. Slaughter cows were mostly lower last week as more and more numbers show up in the western sale barns.
Cash Beef Situation and Outlook:
Last weeks cattle kill was estimated at 590,000 head, which was 90,000 head below the previous week and 16,000 head below the same week a year ago. The boxed beef market was $2.58 lower on the choice cutout and $1.94 lower on the select cutout on increased movement. Friday saw a mixed beef trade with the choice cutout closing $.11 lower to settle at $158.30 and the select cutout closing $.05 higher to settle at $152.05. Sales volume was good with 341 loads of beef sold (139.92 loads of choice fab cuts, 113.08 loads of select fab cuts, 31.84 loads of trim, 55.81 loads of grinds). The choice/select spread settled at $6.25 a loss of $.16.
The main theme in the beef market last week was packers getting into a better sold position on their beef inventory. And it worked as they offered discounts, primarily on middle meats for the first part of the week, which in turn enticed buyers back into the market. We saw load counts go up and movement for the week was described as very good. This will allow packers to raise prices early this week in an attempt to cover higher live inventory costs. Export demand to Asia remains supportive to the market and we will see our domestic demand begin to pick up in the coming weeks. All of which is going to be supportive to prices going forward. I will call for a steady to higher beef market for the first part of this week.
Futures Market Situation and Outlook:
On Friday October live cattle settled at $102.95 a loss of $.35, December live cattle settled at $104.95 a loss of $.35, and the February live cattle settled at $105.80 a loss of $.30. In the feeder cattle pit, September feeder cattle settled at $111.12 a gain of $.35, October feeder cattle settled at $110.67, and the November feeder cattle settled at $110.22 a gain of $.25. The latest reported CME feeder cattle index was $111.98 a gain of $.33.
Futures spent most of the first part of last week trading lower as wild gyrations in the grain market, talk of export disruptions to Mexico and Russia, and ideas the cash markets were going to be lower all weighed on values. I thought the market actually held together fairly well on Friday as we had live cattle futures on the ropes early, however once the market realized we were going to trade $99 cattle on the southern plains, we saw a pretty good short covering rally. There was some very good buying in October live and feeder cattle futures on Friday morning at there lows, and I think this buyer support will spill over into the first part of this week. If we get some follow though buying early today in the live and feeder futures I think it could end up being a positive week. Look for a $.10-$.20 higher to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Vetterkind Cattle Brokerage, LLC
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Friday, September 5, 2008
September 5, 2008
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
A moderate fed cattle trade developed in the northern feeding areas of Nebraska yesterday, with prices running generally $1-$2 lower at $1.54-$1.55 dressed and $97 live. USDA was reporting close to 25,000 head of cattle sold at that price level in their late afternoon report. Many producers were said to be passing the lower bids, especially in the southern regions of the country looking for higher money. Apparently one of the majors in the north keeps talking about having plentiful supplies of contract and formula cattle to kill in the coming weeks and this was said to be a catalysts for producers in that part of the country to accept lower money for their cattle this week. Southern cattle traders could fare a little better than their northern counterparts today as their showlist numbers are quite a bit smaller this week and I don’t think packers have as many contract cattle around them down there. Nevertheless though, early week thoughts of a higher fed cattle trade are quickly diminishing with the lower northern market and a steady trade in the south would seem like a victory coming into this morning. This is going to be more and more of an issue going forward into late Sep/early Oct, as although fed cattle supplies are going to become more and more manageable during this timeframe, packers do have an awful lot of cattle contracted in the northern sections of the country for the same time period. This could develop into a two-tiered market in the coming weeks with premiums being paid on southern cattle. Going home for the weekend, sale barn cattle are trading mostly steady on the fats (i.e. $95-$97 tops), slaughter cows are off about $1-$2 (i.e. $53-$63 on the cutters/boners and $62-$67 on the fat cows). Feeder cattle markets seem to have firmed up a little late in the week as the holiday shortened trading week has curtailed receipts at several locations. Pratt, KS had a pretty good run of yearling cattle on offer yesterday with the majority of their 700-900 lbs feeder steers bringing $109-$117, $2-$3 higher when compared to last week.
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 128,000 head, which would be 1,000 head above last week and even with the same day a year ago. The week-to-date kill now stands at 387,000 head, which would be 122,000 head below the same pace last week. The boxed beef market was mixed yesterday with the choice cutout closing $1.15 lower to settle at $158.41 and the select cutout closing $.13 higher to settle at $152.00. Sales volume was very good with 536 loads of beef sold (196.15 loads of choice fab cuts, 142.40 loads of select fab cuts, 131.75 loads of trim, 65.33 loads of grinds). The choice/select spread settled at $6.41 a loss of $1.28.
The beef market was mixed yesterday with choice cuts losing more to select as packers cleaned up some problem inventory levels of rib and loin meat. Along with the lower market came an increase in movement, as buyers were willing to take on extra product for immediate shipment at the discounted prices. Forward price negotiations continue to take place at higher money on most middle meat items, however there is a reluctance to take on a whole lot of inventory from the buy side at the higher money. End cuts remain mixed, with chuck items supported by export demand from Asia, and round cuts under a degree of pressure from a lack of Russian business. For the most part coarse ground beef markets were steady and ground beef demand is still rated as steady. Boneless markets were mixed once again, with lower 90’s and strong buying in the 50’s supporting values there. Packer inventories of beef to sell seem to be in better shape than they were at the beginning of the week, which will help them in price negotiations next week. Retail/wholesale buyers did take on some extra inventory late this week and likely won’t be too aggressive in the marketplace unless consumer pulls warrant it. With that said though, it feels like the beef market could stabilize and begin to move modestly higher into the first part of next week. Export sales for the week of August 22-28, 2008 are as follows:
Beef: Net sales of 12,300 MT were primarily for South Korea (4,400 MT), Mexico (4,200 MT), Vietnam (1,000 MT), Canada (800 MT), Japan (700 MT), Russia (600 MT), and Taiwan (300 MT). Exports of 15,700 MT--a marketing-year high--were mainly to Mexico (5,500 MT), South Korea (3,600 MT), Russia (1,900 MT), Canada (1,500 MT), Japan (1,300 MT), and Vietnam (1,100 MT).
Futures Market Situation and Outlook:
October live cattle settled at $103.30 a gain of $.15, December live cattle settled at $105.30 a loss of $.17, and the February live cattle settled at $106.10 a gain of $.27. In the feeder cattle pit, September feeder cattle settled at $110.77 a gain of $.22, October feeder cattle settled at $110.37 a gain of $.10, and the November feeder cattle settled at $109.97 a loss of $.07. The reported CME feeder cattle index for 9/3/08 was $111.65 a gain of $.17.
Yesterdays live cattle volume saw 24,031 contracts trade in the pit and 11,003 contracts trade on Globex. Live cattle open interest declined 428 contracts to come in this morning at 271,870. Yesterday’s feeder cattle volume saw 3,161 contracts trade in the pit and 651 contracts trade on Globex. Feeder cattle open interest gained 695 contracts to come in this morning at 30,584.
After an initial lower opening live and feeder cattle futures managed to claw their way back into positive territory by the close on what was said to be some light commercial buying once early morning support held. There was some spreading out of December live going into the close and some light hedge selling that came into April and June, which gave lower settlement prices to those contracts. One would have to think that reports of lower fed cattle sales in Nebraska after the close would exert pressure on front month October and December live cattle this morning. Here again, we will have to keep a close eye on yesterday’s support levels of $102.60-$102.80 in the October and $105 in the December as a clue to price direction. I would imagine that we will open right down against that support this morning, and with a change in cash psychology from yesterday afternoon I would suspect that support to be violated, especially considering sharply lower overnight grains, energies, and metals. Just exactly how much lower could the market go becomes a big question. In the October live cattle contract if we close sloppy today, it would seem like $100-$101 would be a possibility. December will find some support at $104, below that $102 would seem to be in the cards. I am going to keep the same stance on October feeder cattle as yesterday, if we close below $109, the charts would tell you that $104 should be the next price target. The futures market may have to go lower for just a little bit and narrow up the basis and get everybody bearish before it can move higher with a rally in the cash later on in October/November. Deliveries continued last night with Prudential Bache delivering 5 loads of cattle against the August live contract in Norfolk, NE and RJO delivering 10 loads in Tulia, TX, with Rosenthal taking them all. I would look for a $.10-$.20 lower open to live and feeder cattle futures this morning, and we will have to see if we can come back and hold the above mentioned support levels by the close, which as of right now would not seem likely. Trade Well and Have a Good Weekend!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
A moderate fed cattle trade developed in the northern feeding areas of Nebraska yesterday, with prices running generally $1-$2 lower at $1.54-$1.55 dressed and $97 live. USDA was reporting close to 25,000 head of cattle sold at that price level in their late afternoon report. Many producers were said to be passing the lower bids, especially in the southern regions of the country looking for higher money. Apparently one of the majors in the north keeps talking about having plentiful supplies of contract and formula cattle to kill in the coming weeks and this was said to be a catalysts for producers in that part of the country to accept lower money for their cattle this week. Southern cattle traders could fare a little better than their northern counterparts today as their showlist numbers are quite a bit smaller this week and I don’t think packers have as many contract cattle around them down there. Nevertheless though, early week thoughts of a higher fed cattle trade are quickly diminishing with the lower northern market and a steady trade in the south would seem like a victory coming into this morning. This is going to be more and more of an issue going forward into late Sep/early Oct, as although fed cattle supplies are going to become more and more manageable during this timeframe, packers do have an awful lot of cattle contracted in the northern sections of the country for the same time period. This could develop into a two-tiered market in the coming weeks with premiums being paid on southern cattle. Going home for the weekend, sale barn cattle are trading mostly steady on the fats (i.e. $95-$97 tops), slaughter cows are off about $1-$2 (i.e. $53-$63 on the cutters/boners and $62-$67 on the fat cows). Feeder cattle markets seem to have firmed up a little late in the week as the holiday shortened trading week has curtailed receipts at several locations. Pratt, KS had a pretty good run of yearling cattle on offer yesterday with the majority of their 700-900 lbs feeder steers bringing $109-$117, $2-$3 higher when compared to last week.
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 128,000 head, which would be 1,000 head above last week and even with the same day a year ago. The week-to-date kill now stands at 387,000 head, which would be 122,000 head below the same pace last week. The boxed beef market was mixed yesterday with the choice cutout closing $1.15 lower to settle at $158.41 and the select cutout closing $.13 higher to settle at $152.00. Sales volume was very good with 536 loads of beef sold (196.15 loads of choice fab cuts, 142.40 loads of select fab cuts, 131.75 loads of trim, 65.33 loads of grinds). The choice/select spread settled at $6.41 a loss of $1.28.
The beef market was mixed yesterday with choice cuts losing more to select as packers cleaned up some problem inventory levels of rib and loin meat. Along with the lower market came an increase in movement, as buyers were willing to take on extra product for immediate shipment at the discounted prices. Forward price negotiations continue to take place at higher money on most middle meat items, however there is a reluctance to take on a whole lot of inventory from the buy side at the higher money. End cuts remain mixed, with chuck items supported by export demand from Asia, and round cuts under a degree of pressure from a lack of Russian business. For the most part coarse ground beef markets were steady and ground beef demand is still rated as steady. Boneless markets were mixed once again, with lower 90’s and strong buying in the 50’s supporting values there. Packer inventories of beef to sell seem to be in better shape than they were at the beginning of the week, which will help them in price negotiations next week. Retail/wholesale buyers did take on some extra inventory late this week and likely won’t be too aggressive in the marketplace unless consumer pulls warrant it. With that said though, it feels like the beef market could stabilize and begin to move modestly higher into the first part of next week. Export sales for the week of August 22-28, 2008 are as follows:
Beef: Net sales of 12,300 MT were primarily for South Korea (4,400 MT), Mexico (4,200 MT), Vietnam (1,000 MT), Canada (800 MT), Japan (700 MT), Russia (600 MT), and Taiwan (300 MT). Exports of 15,700 MT--a marketing-year high--were mainly to Mexico (5,500 MT), South Korea (3,600 MT), Russia (1,900 MT), Canada (1,500 MT), Japan (1,300 MT), and Vietnam (1,100 MT).
Futures Market Situation and Outlook:
October live cattle settled at $103.30 a gain of $.15, December live cattle settled at $105.30 a loss of $.17, and the February live cattle settled at $106.10 a gain of $.27. In the feeder cattle pit, September feeder cattle settled at $110.77 a gain of $.22, October feeder cattle settled at $110.37 a gain of $.10, and the November feeder cattle settled at $109.97 a loss of $.07. The reported CME feeder cattle index for 9/3/08 was $111.65 a gain of $.17.
Yesterdays live cattle volume saw 24,031 contracts trade in the pit and 11,003 contracts trade on Globex. Live cattle open interest declined 428 contracts to come in this morning at 271,870. Yesterday’s feeder cattle volume saw 3,161 contracts trade in the pit and 651 contracts trade on Globex. Feeder cattle open interest gained 695 contracts to come in this morning at 30,584.
After an initial lower opening live and feeder cattle futures managed to claw their way back into positive territory by the close on what was said to be some light commercial buying once early morning support held. There was some spreading out of December live going into the close and some light hedge selling that came into April and June, which gave lower settlement prices to those contracts. One would have to think that reports of lower fed cattle sales in Nebraska after the close would exert pressure on front month October and December live cattle this morning. Here again, we will have to keep a close eye on yesterday’s support levels of $102.60-$102.80 in the October and $105 in the December as a clue to price direction. I would imagine that we will open right down against that support this morning, and with a change in cash psychology from yesterday afternoon I would suspect that support to be violated, especially considering sharply lower overnight grains, energies, and metals. Just exactly how much lower could the market go becomes a big question. In the October live cattle contract if we close sloppy today, it would seem like $100-$101 would be a possibility. December will find some support at $104, below that $102 would seem to be in the cards. I am going to keep the same stance on October feeder cattle as yesterday, if we close below $109, the charts would tell you that $104 should be the next price target. The futures market may have to go lower for just a little bit and narrow up the basis and get everybody bearish before it can move higher with a rally in the cash later on in October/November. Deliveries continued last night with Prudential Bache delivering 5 loads of cattle against the August live contract in Norfolk, NE and RJO delivering 10 loads in Tulia, TX, with Rosenthal taking them all. I would look for a $.10-$.20 lower open to live and feeder cattle futures this morning, and we will have to see if we can come back and hold the above mentioned support levels by the close, which as of right now would not seem likely. Trade Well and Have a Good Weekend!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Thursday, September 4, 2008
September 4, 2008
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
The cash fed cattle trade was at a standstill yesterday as packer bids of $97 live went unmatched against feedlot offering prices of $101-$103 live and $1.62-$1.63 dressed. A late week trade is expected at what I believe will be steady to higher money. Reasons for this are a smaller showlist offering this week and packers needing cattle to fill forward beef orders in the coming weeks. Fed cattle supplies will be on the decline in the coming weeks due to smaller first and second quarter feedlot placements, at a time when both domestic and export beef demand will be on the increase. While there has been a lot of talk about the recent increase in the U.S. dollar hurting beef, pork, and poultry exports, the dollar still remains 35% off its high back in 2001 and 10% below pre-BSE levels of late 2003. From a historical standpoint our beef remains competitively priced in the global marketplace. Also of support to the beef market will be seasonal domestic demand for rib and loin cuts going into the end of the year. So from a supply/demand standpoint, I continue to remain friendly towards the late summer and fall fed cattle and beef markets. Perhaps we won’t see the highs in the market that we first thought (i.e. $110-$112), but I still think a November high of $105-$108 is still attainable. As we get past the midweek point, we see fed cattle selling through the Sioux Falls, SD auction market trading mostly steady at $94-$96 on the beef cattle and $84-$87 on the Holsteins. Slaughter cows are mostly $1-$2 lower throughout the country at $53-$63 on the cutters and boners and $62-$67 on the breakers and whites. Feeder cattle sales are mostly $1-$2 lower as well, with the majority of the 600 lbs to 800 lbs steers bringing $105-$115.
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 128,000 head, which would be 1,000 head above last week and 1,000 head below the same day a year ago. The week-to-date kill now stands at 259,000 head, which is 123,000 head behind last weeks pace with the industry looking for a 555,000 head production week. The boxed beef market was lower yesterday with the choice cutout losing $.39 to settle at $159.56 and the select cutout losing $.30 to settle at $151.87. Sales volume was good with 412 loads of beef sold (153.28 loads of choice fab cuts, 152.95 loads of select fab cuts, 35.33 loads of trim, 70.20 loads of grinds). The choice/select spread settled at $7.69 a loss of $.09.
The beef market was lower again yesterday with weakness in the rib, loin, and round primals keeping cutout value under pressure. With that said though, sources indicate that inventory levels of said items were getting cleaned up and that it was thought that prices could begin to stabilize by the end of this week and first part of next. Boneless beef items were once again mixed, with strength in the boneless cow 90’s and weakness in the fed cattle 50’s. There has an increase in ground beef and coarse ground demand, and this helps to support the lean trimming’s market coming into the end of the week. I will look for beef values to find some support at current price levels and begin to move higher by the first part of next week.
Futures Market Situation and Outlook:
October live cattle settled at $103.15 a loss of $.60, December live cattle settled at $105.47 a loss of $.62, and the February live cattle settled at $105.82 a loss of $.92. In the feeder cattle pit, September feeder cattle settled at $110.55 a loss of $1.22, October feeder cattle settled at $110.27 a loss of $1.45, and the November feeder cattle settled at $110.05 a loss of $1.22. The reported CME feeder cattle index for 9/2/08 was $111.48 unchanged on the day.
Yesterdays live cattle volume saw 27,314 contracts trade in the pit and 11,799 contracts trade on Globex. Live cattle open interest declined 2,667 contracts to come in this morning at 272,328. Yesterday’s feeder cattle volume saw 3,357 contracts trade in the pit and 758 contracts trade on Globex. Feeder cattle open interest gained 116 contracts to come in this morning at 30,128.
Live and feeder cattle futures ended the day lower yesterday on fund and spec long liquidation linked to rumors of another hedge fund blowing up. Feeders were especially hit hard, led lower by a low volume electronic trade. Deliveries continued yesterday with 15 more loads of cattle posted against the August live contract as we finish squaring up open interest left on the last day on trading. MF Global put out 5 loads of cattle in Norfolk, NE and RJO put out 10 loads of cattle in Tulia, TX, all of which were received by Rosenthal. October live cattle futures look vulnerable to further long liquidation after yesterday’s performance, closing into new lows for the move. There would appear to be some support in the October live contract between $102.60-$102.80, however violating that would move us down to the $101-$101.50 area pretty quick. December needs to hold the $105 area on a closing basis, otherwise $104 is the next stop, and below that $102. October feeder cattle will need to hold $109-$109.50 to stave off a technical move down to $104. Look for a $.10-$.20 lower open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
The cash fed cattle trade was at a standstill yesterday as packer bids of $97 live went unmatched against feedlot offering prices of $101-$103 live and $1.62-$1.63 dressed. A late week trade is expected at what I believe will be steady to higher money. Reasons for this are a smaller showlist offering this week and packers needing cattle to fill forward beef orders in the coming weeks. Fed cattle supplies will be on the decline in the coming weeks due to smaller first and second quarter feedlot placements, at a time when both domestic and export beef demand will be on the increase. While there has been a lot of talk about the recent increase in the U.S. dollar hurting beef, pork, and poultry exports, the dollar still remains 35% off its high back in 2001 and 10% below pre-BSE levels of late 2003. From a historical standpoint our beef remains competitively priced in the global marketplace. Also of support to the beef market will be seasonal domestic demand for rib and loin cuts going into the end of the year. So from a supply/demand standpoint, I continue to remain friendly towards the late summer and fall fed cattle and beef markets. Perhaps we won’t see the highs in the market that we first thought (i.e. $110-$112), but I still think a November high of $105-$108 is still attainable. As we get past the midweek point, we see fed cattle selling through the Sioux Falls, SD auction market trading mostly steady at $94-$96 on the beef cattle and $84-$87 on the Holsteins. Slaughter cows are mostly $1-$2 lower throughout the country at $53-$63 on the cutters and boners and $62-$67 on the breakers and whites. Feeder cattle sales are mostly $1-$2 lower as well, with the majority of the 600 lbs to 800 lbs steers bringing $105-$115.
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 128,000 head, which would be 1,000 head above last week and 1,000 head below the same day a year ago. The week-to-date kill now stands at 259,000 head, which is 123,000 head behind last weeks pace with the industry looking for a 555,000 head production week. The boxed beef market was lower yesterday with the choice cutout losing $.39 to settle at $159.56 and the select cutout losing $.30 to settle at $151.87. Sales volume was good with 412 loads of beef sold (153.28 loads of choice fab cuts, 152.95 loads of select fab cuts, 35.33 loads of trim, 70.20 loads of grinds). The choice/select spread settled at $7.69 a loss of $.09.
The beef market was lower again yesterday with weakness in the rib, loin, and round primals keeping cutout value under pressure. With that said though, sources indicate that inventory levels of said items were getting cleaned up and that it was thought that prices could begin to stabilize by the end of this week and first part of next. Boneless beef items were once again mixed, with strength in the boneless cow 90’s and weakness in the fed cattle 50’s. There has an increase in ground beef and coarse ground demand, and this helps to support the lean trimming’s market coming into the end of the week. I will look for beef values to find some support at current price levels and begin to move higher by the first part of next week.
Futures Market Situation and Outlook:
October live cattle settled at $103.15 a loss of $.60, December live cattle settled at $105.47 a loss of $.62, and the February live cattle settled at $105.82 a loss of $.92. In the feeder cattle pit, September feeder cattle settled at $110.55 a loss of $1.22, October feeder cattle settled at $110.27 a loss of $1.45, and the November feeder cattle settled at $110.05 a loss of $1.22. The reported CME feeder cattle index for 9/2/08 was $111.48 unchanged on the day.
Yesterdays live cattle volume saw 27,314 contracts trade in the pit and 11,799 contracts trade on Globex. Live cattle open interest declined 2,667 contracts to come in this morning at 272,328. Yesterday’s feeder cattle volume saw 3,357 contracts trade in the pit and 758 contracts trade on Globex. Feeder cattle open interest gained 116 contracts to come in this morning at 30,128.
Live and feeder cattle futures ended the day lower yesterday on fund and spec long liquidation linked to rumors of another hedge fund blowing up. Feeders were especially hit hard, led lower by a low volume electronic trade. Deliveries continued yesterday with 15 more loads of cattle posted against the August live contract as we finish squaring up open interest left on the last day on trading. MF Global put out 5 loads of cattle in Norfolk, NE and RJO put out 10 loads of cattle in Tulia, TX, all of which were received by Rosenthal. October live cattle futures look vulnerable to further long liquidation after yesterday’s performance, closing into new lows for the move. There would appear to be some support in the October live contract between $102.60-$102.80, however violating that would move us down to the $101-$101.50 area pretty quick. December needs to hold the $105 area on a closing basis, otherwise $104 is the next stop, and below that $102. October feeder cattle will need to hold $109-$109.50 to stave off a technical move down to $104. Look for a $.10-$.20 lower open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Wednesday, September 3, 2008
September 3, 2008
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
Fed cattle trading was inactive in all trading areas yesterday as participants spent the day putting new showlists together. No packer bids were being reported as of last night with producers pricing a lower weekly showlist offering at $101-$103 live and $1.63-$1.64 dressed. A quick look at last weeks sales volumes and prices shows Texas/Oklahoma feedlots selling 49,775 head of fed cattle for mostly $99 live, Kansas feedlots selling 41,245 head of fed cattle for $99 live and $1.56 dressed, Nebraska feedlots selling 67,170 head of fed cattle for $99-$99.50 live and $1.56 dressed, Colorado feedlots selling 5,570 head of fed cattle for $99 live and $1.56-$1.57 dressed, and Iowa/MN feedlots selling 27,735 head of fed cattle for $97-$98 live and $1.55 dressed. As we can see last weeks feedlot movement was pretty good and private sources indicate that a lot of backed up cattle were moved last week. Many feel that this will open the door for higher prices again this week. Feedlot supplies of cattle are expected to decline modestly from now through late December, and this along with still fairly good export demand for beef and an expected increase in domestic middle meat demand going into fall, will be supportive to the fed cattle market from September through November. Packers do have a lot of cattle contracted for the October timeframe, and this along with a general softening of the U.S. economy could limit prices from achieving previous price forecasts of $110-$112, however a yearly high of $105-$108 sometime in November is still attainable. For this week, I would expect the market to be flat until we get closer to the weekend, at which time I think we will be able to sell fat cattle at steady to higher money (i.e. $99-$100 live and $1.58-$1.60 dressed).
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 128,000 head, which would be steady with a week ago and 2,000 head below the same period last week. With an estimated Monday slaughter of 3,000 head, the week-to-date kill stands at 131,000 head, which would be 124,000 head behind last weeks pace. I would look for a 555,000 head production week. The USDA also revised last Saturday’s kill up to 43,000 head, which put last week’s cattle slaughter up to 680,000 head. The boxed beef market was lower yesterday with the choice boxed beef down $.59 to settle at $159.95 and the select-boxed beef down $1.26 to settle at $152.17. Sales volume was light with 275 loads of beef sold (111.39 loads of choice fab cuts, 93.59 loads of select fab cuts, 18.18 loads of trim, 51.67 loads of grinds). The choice/select spread settled at $7.78 a gain of $.67.
The beef market was under a degree of pressure again yesterday as most participants spent the day going over inventory positions and weekend beef clearance. Rib and loin cuts were lower yesterday, as there seems to be carryover product coming out of last week and packers were discounting those items in order to clear inventories. Also under pressure yesterday were several items throughout the round complex, as here too, inventories coming out of last week are a little burdensome at the packinghouse level. These lower price transactions relate to spot delivery of product as pricing for forward delivery takes place at higher money. Boneless beef item were mixed yesterday with steady to higher money being paid on 50% fed cattle trim and lower money being paid on the 90% lean cow beef. There are a few more cows coming to market the last couple of weeks and this is putting pressure on the lean beef items. I think we will see the beef market trade steady to lower until about midweek, at which time we will see buyers step back into the market. I also think we will begin to see a more concerted effort in securing middle meats for end of year celebrations, which along with lower fed cattle beef production towards the end of September and through October, will give us the next leg up in beef prices going into the fall.
Futures Market Situation and Outlook:
October live cattle settled at $103.75 a loss of $.30, December live cattle settled at $106.10 a loss of $.30, and the February live cattle settled at $106.75 a gain of $.02. In the feeder cattle pit, September feeder cattle settled at $111.77 a gain of $.62, October feeder cattle settled at $111.72 a gain of $.77, and the November feeder cattle settled at $111.27 a gain of $1.00.The reported CME feeder cattle index for September 1, 2008 was $111.48 a gain of $.16.
It was another quiet day in the cattle futures pit as traders try to determine the proper direction of the market. Fat cattle futures were under moderate pressure most of the day on what I believed was weakness in the outside markets and lower midday boxed beef quotes. All things considered I thought live cattle held up fairly well given the weakness in the grains, metals, and energies. Feeders were supported by the weakness in CBOT corn and the futures being oversold and discount to the CME index. There were 15 deliveries against the August live cattle contract last night with MF Global delivering 5 loads out of Amarillo, TX, Cadent delivering 3 loads out of Norfolk, NE, and RJO delivering 7 loads out of Norfolk, NE. Rosenthal received all 15 loads. I still think we will find some support under the market on any early week sell off and would be interested in owning December live cattle on a pull back to the $105 area. October feeder cattle had a pretty impressive reversal type trade last Friday and I can’t help but think we could get a corrective trade higher into the $113-$114 area in the near term. You can try to trade it from the long side and capture the quick up should it develop, however the better trade in my opinion would be to initiate short positions should we approach that area. Look for a $.10-$.20 lower open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
Fed cattle trading was inactive in all trading areas yesterday as participants spent the day putting new showlists together. No packer bids were being reported as of last night with producers pricing a lower weekly showlist offering at $101-$103 live and $1.63-$1.64 dressed. A quick look at last weeks sales volumes and prices shows Texas/Oklahoma feedlots selling 49,775 head of fed cattle for mostly $99 live, Kansas feedlots selling 41,245 head of fed cattle for $99 live and $1.56 dressed, Nebraska feedlots selling 67,170 head of fed cattle for $99-$99.50 live and $1.56 dressed, Colorado feedlots selling 5,570 head of fed cattle for $99 live and $1.56-$1.57 dressed, and Iowa/MN feedlots selling 27,735 head of fed cattle for $97-$98 live and $1.55 dressed. As we can see last weeks feedlot movement was pretty good and private sources indicate that a lot of backed up cattle were moved last week. Many feel that this will open the door for higher prices again this week. Feedlot supplies of cattle are expected to decline modestly from now through late December, and this along with still fairly good export demand for beef and an expected increase in domestic middle meat demand going into fall, will be supportive to the fed cattle market from September through November. Packers do have a lot of cattle contracted for the October timeframe, and this along with a general softening of the U.S. economy could limit prices from achieving previous price forecasts of $110-$112, however a yearly high of $105-$108 sometime in November is still attainable. For this week, I would expect the market to be flat until we get closer to the weekend, at which time I think we will be able to sell fat cattle at steady to higher money (i.e. $99-$100 live and $1.58-$1.60 dressed).
Cash Beef Situation and Outlook:
Yesterdays kill was estimated at 128,000 head, which would be steady with a week ago and 2,000 head below the same period last week. With an estimated Monday slaughter of 3,000 head, the week-to-date kill stands at 131,000 head, which would be 124,000 head behind last weeks pace. I would look for a 555,000 head production week. The USDA also revised last Saturday’s kill up to 43,000 head, which put last week’s cattle slaughter up to 680,000 head. The boxed beef market was lower yesterday with the choice boxed beef down $.59 to settle at $159.95 and the select-boxed beef down $1.26 to settle at $152.17. Sales volume was light with 275 loads of beef sold (111.39 loads of choice fab cuts, 93.59 loads of select fab cuts, 18.18 loads of trim, 51.67 loads of grinds). The choice/select spread settled at $7.78 a gain of $.67.
The beef market was under a degree of pressure again yesterday as most participants spent the day going over inventory positions and weekend beef clearance. Rib and loin cuts were lower yesterday, as there seems to be carryover product coming out of last week and packers were discounting those items in order to clear inventories. Also under pressure yesterday were several items throughout the round complex, as here too, inventories coming out of last week are a little burdensome at the packinghouse level. These lower price transactions relate to spot delivery of product as pricing for forward delivery takes place at higher money. Boneless beef item were mixed yesterday with steady to higher money being paid on 50% fed cattle trim and lower money being paid on the 90% lean cow beef. There are a few more cows coming to market the last couple of weeks and this is putting pressure on the lean beef items. I think we will see the beef market trade steady to lower until about midweek, at which time we will see buyers step back into the market. I also think we will begin to see a more concerted effort in securing middle meats for end of year celebrations, which along with lower fed cattle beef production towards the end of September and through October, will give us the next leg up in beef prices going into the fall.
Futures Market Situation and Outlook:
October live cattle settled at $103.75 a loss of $.30, December live cattle settled at $106.10 a loss of $.30, and the February live cattle settled at $106.75 a gain of $.02. In the feeder cattle pit, September feeder cattle settled at $111.77 a gain of $.62, October feeder cattle settled at $111.72 a gain of $.77, and the November feeder cattle settled at $111.27 a gain of $1.00.The reported CME feeder cattle index for September 1, 2008 was $111.48 a gain of $.16.
It was another quiet day in the cattle futures pit as traders try to determine the proper direction of the market. Fat cattle futures were under moderate pressure most of the day on what I believed was weakness in the outside markets and lower midday boxed beef quotes. All things considered I thought live cattle held up fairly well given the weakness in the grains, metals, and energies. Feeders were supported by the weakness in CBOT corn and the futures being oversold and discount to the CME index. There were 15 deliveries against the August live cattle contract last night with MF Global delivering 5 loads out of Amarillo, TX, Cadent delivering 3 loads out of Norfolk, NE, and RJO delivering 7 loads out of Norfolk, NE. Rosenthal received all 15 loads. I still think we will find some support under the market on any early week sell off and would be interested in owning December live cattle on a pull back to the $105 area. October feeder cattle had a pretty impressive reversal type trade last Friday and I can’t help but think we could get a corrective trade higher into the $113-$114 area in the near term. You can try to trade it from the long side and capture the quick up should it develop, however the better trade in my opinion would be to initiate short positions should we approach that area. Look for a $.10-$.20 lower open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Tuesday, September 2, 2008
September 2, 2008
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
We left last week with a fed cattle market that was mostly steady with the previous week at $99 live and $1.55-$1.56 dressed in both the northern and southern feeding regions of the country on moderate movement. Feeder cattle values were off by $1-$2 last week as were slaughter cows. Coming back to work this week, I would expect to see boxed beef values to stabilize a bit, and I think we will see some active fill-in business from the holiday. The fed cattle offering should be steady to lower this week, which leaves me thinking that we could see a steady to better fed cattle trade. I would expect to see feeder cattle values on the defensive early this week along with slaughter cow markets, as we see more and more numbers of that class of cattle come to market.
Cash Beef Situation and Outlook:
Last weeks cattle kill was estimated at 677,000 head and included a Friday slaughter of 128,000 head and a Saturday slaughter of 40,000 head. For the week the choice boxed beef lost $.53 and select boxed beef values lost $2.54 on moderate volume. Friday saw a mostly steady beef trade with the choice cutout closing $.20 lower to settle at $160.79 and the select cutout closing $.11 lower to settle at $153.83. Sales volume on Friday was light with 133 loads of beef sold (53.43 loads of choice fab cuts, 35.55 loads of select fab cuts, 18.61 loads of trim, 25.08 loads of grinds). The choice/select spread settled at $6.97 a loss of $.09.
Last weeks boxed beef market was mostly flat to lower as buyers went to the sidelines ahead of the Labor Day holiday taking a wait and see approach to the market. Most primal sections of the beef carcass were in need of some sort of discounting last week. There was also talk in the marketplace last week that beef and pork exports to Mexico, Russia, and China could be in question as those countries say they will either be increasing their production, or in the case of Mexico, will not be buying as much beef and pork from us due to the USDA delisting Mexican meat plants from exporting to the U.S. I think a lot of this import/export talk is politically related and I would caution about getting too bearish our meat markets because of this. I would look for the boxed beef market to be flat for the first part of this week and firming late.
Futures Market Situation and Outlook:
On Friday, October live cattle settled at $104.05 a gain of $.22, December live cattle settled at $106.40 a gain of $.52, and the February live cattle settled at $106.72 a gain of $.52. In the feeder cattle pit, September feeder cattle settled at $111.15 a gain of $.05, October feeder cattle settled at $110.95 a gain of $.52, and the November feeder cattle settled at $110.27 a gain of $.40. The reported CME feeder cattle index for 8/28/08 was $112.33 a loss of $.43.
Fridays live cattle volume saw 27,142 contracts trade in the pit and 11,491 contracts trade on Globex. Live cattle open interest gained 116 contracts to come in this morning at 273,690. Friday’s feeder cattle volume saw 3,673 contracts trade in the pit and 622 contracts trade on Globex. Feeder cattle open interest declined 403 contracts to come in this morning at 31,830.
We left last week with a futures market that sold off hard early on talk of import/export restrictions with some of our major trading partners, and firmed late on the better than anticipated cash markets. My opinion of this week’s futures market is steady to higher by the end of the week. I think we will start off a little better in both live and feeder cattle futures, however with the outside markets in such disarray early this morning we have to be careful that some of this weakness doesn’t spill over into the cattle market. If it did and we saw a sell off today or tomorrow, I would say that it would be a buy going into the end of this week. There were 18 deliveries posted against the August live cattle contract on Friday, with RJO delivering 15 loads and Penson delivering 3 loads, all out of Tulia, TX. Rosenthal received all 18 loads. Look for October live cattle to find early week support at $103 and December live cattle to find early week support at $105. Look for a $.10-$.20 higher open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Good Morning from the Chicago Board of Trade,
Cash Cattle Situation and Outlook:
We left last week with a fed cattle market that was mostly steady with the previous week at $99 live and $1.55-$1.56 dressed in both the northern and southern feeding regions of the country on moderate movement. Feeder cattle values were off by $1-$2 last week as were slaughter cows. Coming back to work this week, I would expect to see boxed beef values to stabilize a bit, and I think we will see some active fill-in business from the holiday. The fed cattle offering should be steady to lower this week, which leaves me thinking that we could see a steady to better fed cattle trade. I would expect to see feeder cattle values on the defensive early this week along with slaughter cow markets, as we see more and more numbers of that class of cattle come to market.
Cash Beef Situation and Outlook:
Last weeks cattle kill was estimated at 677,000 head and included a Friday slaughter of 128,000 head and a Saturday slaughter of 40,000 head. For the week the choice boxed beef lost $.53 and select boxed beef values lost $2.54 on moderate volume. Friday saw a mostly steady beef trade with the choice cutout closing $.20 lower to settle at $160.79 and the select cutout closing $.11 lower to settle at $153.83. Sales volume on Friday was light with 133 loads of beef sold (53.43 loads of choice fab cuts, 35.55 loads of select fab cuts, 18.61 loads of trim, 25.08 loads of grinds). The choice/select spread settled at $6.97 a loss of $.09.
Last weeks boxed beef market was mostly flat to lower as buyers went to the sidelines ahead of the Labor Day holiday taking a wait and see approach to the market. Most primal sections of the beef carcass were in need of some sort of discounting last week. There was also talk in the marketplace last week that beef and pork exports to Mexico, Russia, and China could be in question as those countries say they will either be increasing their production, or in the case of Mexico, will not be buying as much beef and pork from us due to the USDA delisting Mexican meat plants from exporting to the U.S. I think a lot of this import/export talk is politically related and I would caution about getting too bearish our meat markets because of this. I would look for the boxed beef market to be flat for the first part of this week and firming late.
Futures Market Situation and Outlook:
On Friday, October live cattle settled at $104.05 a gain of $.22, December live cattle settled at $106.40 a gain of $.52, and the February live cattle settled at $106.72 a gain of $.52. In the feeder cattle pit, September feeder cattle settled at $111.15 a gain of $.05, October feeder cattle settled at $110.95 a gain of $.52, and the November feeder cattle settled at $110.27 a gain of $.40. The reported CME feeder cattle index for 8/28/08 was $112.33 a loss of $.43.
Fridays live cattle volume saw 27,142 contracts trade in the pit and 11,491 contracts trade on Globex. Live cattle open interest gained 116 contracts to come in this morning at 273,690. Friday’s feeder cattle volume saw 3,673 contracts trade in the pit and 622 contracts trade on Globex. Feeder cattle open interest declined 403 contracts to come in this morning at 31,830.
We left last week with a futures market that sold off hard early on talk of import/export restrictions with some of our major trading partners, and firmed late on the better than anticipated cash markets. My opinion of this week’s futures market is steady to higher by the end of the week. I think we will start off a little better in both live and feeder cattle futures, however with the outside markets in such disarray early this morning we have to be careful that some of this weakness doesn’t spill over into the cattle market. If it did and we saw a sell off today or tomorrow, I would say that it would be a buy going into the end of this week. There were 18 deliveries posted against the August live cattle contract on Friday, with RJO delivering 15 loads and Penson delivering 3 loads, all out of Tulia, TX. Rosenthal received all 18 loads. Look for October live cattle to find early week support at $103 and December live cattle to find early week support at $105. Look for a $.10-$.20 higher open to live and feeder cattle futures this morning. Trade Well!!!
Any one wanting a more detailed report on the cattle and beef markets including fundamental, chart and technical analysis, plus spec/hedge recommendations for packers, processors, producers, and meat buyers feel free to contact me by phone or e-mail to set up a free trial.
There is risk in trading futures and options.
Have a Good Day,
Troy Vetterkind
Chicago Board of Trade
141 West Jackson Blvd.
Suite 1220A
Chicago, IL 60604
1-888-299-1477 Toll Free
1-312-896-2068 Direct
1-708-224-5985 Mobile
tvetterkind@linngroup.com
Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn Group, Inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. This material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn Group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss. Past performance is not indicative of future results.
Subscribe to:
Posts (Atom)