Cattle Futures - Live Cattle Slide

US - Except for the spot-July Chicago Mercantile Exchange hogcontract that was pressured by cash price weakness, other contracts closedhigher on August/October bull spreading and October/December bear-positioningthat capped October's advances but gave August and December added lift. Porkbellies settled mixed. Meanwhile, live cattle closed lower and feeders weak on the day.
calendar icon 11 July 2007
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CME live cattle closed lower in response to CBOT feedgrain's rally,August/October bull spreads that weighed more on October than August, andAugust longs' sporadic migration into October during the Goldman roll period.

Cattle futures adopted a bearish posture despite recent bullish boxed beefquotes and last week's better-than-anticipated fed cattle prices.

August and October cattle futures spike at the start spurred by Monday'sboxed beef jump that spawned August/October bull spreading. At that time, CBOTcorn was narrowly mixed which motivated front-month cattle buyers to pushAugust to a seven-week top and October to a high not seen since April 11.

However, upward momentum sputtered as longs slid money off the table, in partbecause of August and October's technically overbought indicators. What's more,live cattle contracts across the board receded as CBOT corn contracts gainedground as the session wore on.

Murmurs of $90 per hundredweight live-weight packer bids on Tuesday were metwith silence from cattle owners. Meanwhile, cattle futures traders wonder howmuch more upside potential the board has given premiums to last week's cashtrade and August and October's continued overbought chart conditions.

RJ O'Brien was among August buyers. Fimat bought October and sold Decemberoutright and was cited an August/October roller. Rosenthal bought October andsold August on the roll. ADM and Cadent Financial were among October sellers.

Feeder cattle ended weaker on reversal of early-morning bull spreads, livecattle's retreat from session highs and CBOT feedgrain advances.

August live cattle settled at 91.97 cents per pound, down 55 points, andOctober ended at 96.50 cents, a loss of 67 points.

August feeder cattle finished 45 points lower at 114.02 cents. Septemberclosed 20 points weaker at 115.17 cents.

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