Cattle markets across the board were down today, some more than other but down nonetheless. Dec cattle finished .525 lower and settling at 152.475. The market is still in overbought territory and I’ve been hearing that the cash market is starting to add support to futures as I’ve heard possible cash bids in the 160 range. While the cash bids may support the market, I believe that there will be a consolidation period coming in the short term. On Mid-session Friday the USDA boxed beef cutout was up 73 cents and closed up 77 cents at 263.26. Due to the overbought conditions, there is the possibility of a retracement to the $150 level (around 50%). I don’t believe there will be that much of a correction due to the supporting fundamental factors but it is something to look out for.
Estimated average dressed cattle weight last week was 831 pounds which was up from 830 last week and down from 834 a year ago. Estimated beef production was last week was 554 million pounds which was down about 1.4 million pounds from last week. The cattle slaughter numbers came in at 124k on Friday and 32k on Saturday, which brought the total for last week to 668k down from 673k the previous week. On Friday the COT came out and showed that managed money traders were net buyers of 28,423 contracts of live cattle for the week ending October 25, which increased their net long positions to 65,722.
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