The cattle market began the week chopping both sides of unchanged through the first half of yesterday’s session, before again sinking lower late in the day. Most active Feb live cattle came within $1.10 of last week’s contract lows, while Jan feeder cattle actually took out those prior lows on their way to a $4.50 limit move by day’s end. Weather is taking something off cattle performance and carcass weights, but regardless, weights still remain at record heavy levels. The most recent data (week ending Nov 28) has the average carcass up 20 lbs (2.4%) vs last year. Combine that with last week’s season large 581K head kill (up 1.9% vs LY) and total beef production this past week would have been up a significant 4.5% vs last year. But yet futures still acted surprised with a sharply lower print in the choice cutout yesterday afternoon, down $3.72, which was mostly the result of a quick $24 plunge in the rib primal and an indication our holiday rib business has likely run its course. Futures will be expected to open lower this morning, with technical traders eyeing last week’s live cattle lows.
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