Ag markets saw early pressure Thursday, but cattle have traded on both sides of steady.
Scott Varilek, Kooima Kooima Varilek, says after new highs for the move in both live and feeder cattle futures yesterday there was some initial hedge pressure and profit taking.
Plus, packers are talking about kill cuts with their margins in the red and so they are compensating by pushing cattle back and weights up in the South and dressed weights on steers continue to run well above last year.
However, it looks like cash trade is going to be higher again this week.
Some $186 was already paid in the South yesterday and $187-$188 in the North was bought by a regional, while producers asking $190.
The cattle charts also look positive after the strong day Wednesday.
Lean hog futures faded strong exports of 43,400 metric tons and seeing some profit taking after near term highs were hit there as well.
However, the Lean Hog Index was up 32 cents coming in and will be supportive as well as funds seem to buy on the breaks.
So far the hog market has been immune to the port strike but it could back up product going to important export markets.
Grain futures are mostly lower on general risk off selling in the complex and despite decent export sales.
USDA reported weekly corn exports were strong at 66. 3 million bushels, soybeans at 53 million and wheat at 16.3 million bushels.
Varilek says some of the pressure in grains is coming from rain chances in the Brazil forecast.
The funds are nearly out of ammunition to cover shorts, plus prices have run into some chart resistance he adds.
