Packers may have purchased much of what they needed for this week, which could result in lower cash. This combination should provide support Thursday. The National Direct Afternoon Hog report showed cash up $0.78 with a weighted average of $96.34. Some pressure may have stemmed from higher grain prices. The weakness of nearby months was not the result of cash or cutouts but likely some spread-trading activity. Hogs did not quite have the exuberance that has been nearly a daily occurrence since Memorial Day. Placements in May at 101.7% of last year and marketings at 101.6%. The average trade estimate for on-feed numbers on June 1 is 96.8%. USDA will release the Cattle on Feed report Friday. Futures gapped lower on the open and never looked back, moving contracts back to the lowest level since May 11. The large increase in corn futures sent feeder cattle plummeting. Boxed beef has been showing signs of weakening, which will have a negative impact on cattle prices. Boxed beef was lower with choice down $2.66 and select down $3.68. Some light cash trade took place in the South at $180 or $2.00 lower with a few deals in the North at $184, averaging $1.00 to $2.00 lower. Traders seem to have adjusted live cattle futures in line with the potential for lower cash again this week. Live cattle futures closed mixed Wednesday, holding their own considering the substantial pressure put on feeder cattle. ** based on formula estimating lean hog equivalent of gross packer revenue. Index has been updated to depict recent changes in live cattle weights and grading percentages.) *Based on formula estimating live cattle equivalent of gross packer revenue. Hogs: Steady Futures: Higher Lean Equiv: $103.17 +$1.46** Cattle: Lower Futures: Higher Live Equiv: $242.29 -$2.15*
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