Cattle Futures Volatility Meets Grain Complex Rally
Cattle futures saw significant volatility this week as traders awaited key reports on cattle inventory and feed. Despite the market's indecision, August live cattle closed up $2.65 for the week, while August feeders declined by only $.62. In the cash market, prices began at 228 but mostly traded around $230, $8 lower than last week.
The Cattle On Feed report showed 102 On Feed, 97 Placed and 97 Marketed, with placements 1.8% below average expectations. The Inventory report revealed July 1 cattle numbers up slightly, with all cattle and calves totaling 94.2m head compared to last year's 94m.
Managed money sold 20K live cattle contracts but still holds a long position of 75K according to the Commitment of Traders report. The market sentiment is shifting, and although both live and feeder cattle futures charts appear to be forming a base for potential rotation higher next week, lower lows should not be discounted.
The grain complex saw an impressive rally this week, with December corn making new highs last seen on May 20th. Driven by war premium caused by shipping disruptions in the Red Sea and US/Iran conflict headlines, as well as a threatening US forecast, new contract highs were also made in wheat and soybeans.