Written Commentary
MORNING LIVESTOCK OUTLOOK
LIVE CATTLE
Packer profit margins, using prices off the daily comprehensive beef cutout sheet, are huge. If packers increase kill and beef supplies, it puts more beef in the store shelves, prices will drop. If they keep supplies tight, profit margins remain high. It is the basic definition of economics, maximization of satisfaction in the face of scarcity.
LEAN HOGS
As of Wednesday, there are 3 days left to trade on the August 2021 CME Lean Hogs. Cash and futures are converging as they should. Fundamentals are moving August Lean Hogs. October 2021 Lean Hogs and the Lean Hogs into April 2022 are dominated by spread traders.
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