CME: Futures Closed Moderately Lower Tuesday09 January 2013
US - February cattle closed moderately lower on the day with Texas cash cattle at $128.00.
The wide basis, talk that much of the predicted moisture this week will come in well east of the feedlot regions and concerns that beef prices might run into consumer resistance overhead helped spark some selling pressure.
With cash cattle at $128.00 in Texas today, the premium, the fact that packer profit margins remain deep in the red and a lack of short-term weather issues were all seen as factors which could spark some short-term selling.
In addition, the showlist is higher this week and weights do not point to overly-current marketings from packers. A change in the weather and a "clean-up" of any backed-up market-ready cattle from feedlots are factors which could quickly shift the cash fundamentals from sloppy to bullish.
Beef prices were lower late yesterday and this added to the negative tone early. However, traders continue to see tighter supply ahead and speculative buyers appear to be active on breaks to support.
April cattle pushed down to the lowest level since December 14th before closing 40 lower, up 42 points from the lows. Choice boxed-beef cut-out values were up $0.53 to $194.02 as compared with $194.15 last week at this time.
Select boxed-beef cut-out values at mid-session were up $0.68 to $183.28 as compared with $181.05 last week at this time. Slaughter came in slightly above expectations which is a positive demand factor.
TheCattleSite News Desk