Weather seems to be dominating the headlines recently which is causing the agricultural markets to become a little more volatile these next couple weeks. Dec cattle closed up .725 today on decent volume which leads me to believe that there will be some follow through action tomorrow, especially if the heat wave fears turn into reality. Cutout values today closed at 270.49, which was up 1.58 from Friday. The USDA reported that live steers averaged 142.09 through Friday morning, which was down from the previous week of 144.35. The USDA cattle slaughter came in, estimated at 123,000 on Friday and 54,000 head on Saturday. This brought the total for the week up to 677,000 head, which was up from 593,000 last week and up from 650,000 a week ago. With a possible production decline for the 3rd and 4th quarters, the 1st quarter of next year looks to have a continued production dip as well. I still continue to believe that the Dec contract could reach back up to the 143 price level here in the short term.
