Cattle futures opened lower, but traded firmer for most of the session yesterday, supported by reports of packers bidding $184 dressed in the North, which would have been steady with the trade there late last week, and getting some light volume trade going at that level. Packers bidding $117-118 in the South with no trade there yet. I sense the marketplace was maybe not impressed, but perhaps relieved, that packers are willing to bid those levels on a Tuesday, the week ahead of two holiday-shortened slaughter weeks, and in the face of still weaker wholesale beef markets. The choice cutout was off another $1.57 yesterday and now rests on fresh two year lows, same for the select. Nearby Dec futures at $120+ and Feb at $125+ still carry a hefty premium to the cash markets and are looking at a weaker start this morning. Technically, yesterday’s rally wasn’t significant and again leaves us all wondering whether yesterday’s strength was the beginning of something meaningful or just simple “turnaround Tuesday” action.
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