Nearby Dec live cattle futures closed out the week with a sharp $7.55 loss and on fresh contract lows, with the early October spot low of near $120 as the only remaining downside technical support. Weekly slaughter totaled 560K head, slightly below the 564K head of the same week last year, but after accounting for carcass weights which are up 2.6%, total beef production continues to outpace year-ago levels. Both the spot choice and select cutout indexes fell to fresh two year lows on Friday and, as noted throughout last week, the cash cattle marketplace remains weaker as well. The bulls would really like to see market economics at work with lower prices spurring consumer demand, but the problem remains that while the wholesale markets have been a wreck, retail prices have barely come off their highs. How can we spur demand when the ultimate consumer doesn’t yet see the lower prices!!?? Do remember the WTO is expected to rule today on Canadian and Mexican retaliatory measures against the U.S. country of origin labeling law.
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