This afternoon's Cold Storage Report is positive for live cattle and lean hog futures, as it reflects a tighter-than-expected stocks situation due to continued strong demand. Total pork and beef stocks in Cold Storage came in below traders' expectations.
At 414.215 million lbs., total frozen beef stocks at the end of October came in below the average trade guess of 425.9 million lbs. and are three percentage points tighter than last month. While equal to year-ago levels, the fact last week's Cattle on Feed Report showed cattle marketed in October up three percentage points from year-ago levels signals demand is more than strong enough to keep the pipeline from backing up.
Frozen pork stocks at 490.695 million lbs. came in around 16 million lbs. lighter than traders expected and are even with month-ago levels. Considering the seasonal increase in hog supplies coming to market last month, the report reflects an improved demand pace.
The report also shows total frozen poultry supplies down seven percentage points from the previous month and four percentage points below year-ago levels. Total red meat supplies were down two percentage points from last month, but one percentage point higher than year-ago.
Link to report