Grains are higher as well as cattle early Friday, while hogs are mixed.
Scott Varilek, Kooima Kooima Varilek, says cattle futures continue to hold strong with more record cash.
Cash trade yesterday was as high as $223 in the North on good volume. Dressed prices in the North were mostly $350, up $10 with a range of $340 to $352. The South traded from $214 to mostly $218 live, up $5 to $6 from last week.
Varilek says packers were still looking for cattle Friday morning at those levels, which is a bullish sign that packers are short bought.
The live cattle futures are at a discount to the cash but did not make new contract highs Thursday or early Friday morning.
So, is the market looking tired?
Varilek says he thinks the futures are just taking a breather and as long as cash stays strong the futures market is in good shape with buying on the breaks.
Feeder cattle futures are also supported by the rising cash index which hit record levels this week and demand for feeders is strong.
Lean hog futures are mixed, despite some positive news about China trade talks starting, but with the futures premium to the cash index that may be holding the market back.
Grain futures were all higher Friday morning as they seem to be more optimistic about a de-escalation of the trade war with China says Varilek.
However, he thinks there is also some value buying, especially in wheat which hit new contract lows in KC futures yesterday, which is lifting grain prices.
The July soybeans are back above the 100 and 200-day moving averages which is positive and July corn is above the 40-day.
