August cattle closed 52 lower on the session yesterday, as a late selloff in the stock market was widely thought to have pressured the market. An early rally was based on positive outside market factors and helped to lift cattle futures to their highest level since May 23rd. However, the market turned lower for the day as a more negative outside market forces emerged. In addition, concerns with recent sloppy trading in the beef market were also seen as pressuring the market. Weakness in energy and metal markets added to the more negative tone for commodity markets as well. Reports of lower beef prices, outside market pressure and a larger showlist are all factors which might point towards lower cash cattle prices this week. While some traders see lower cash prices this week, others see steady cash trading through June and then a possible rise into the summer as the market will face a decline in beef production during a period when prices typically decline. While this is based on a tendency for beef production to increase from the second to the third quarter, beef production this year is expected to be lower for only the second time in the past 22 years. Boxed beef cutout values were down 28 cents at mid-session yesterday and closed 75 cents higher at $197.69. This was up from $197.62 the prior week and is the highest beef market since March 6th. Select beef prices were up $1.01 to $183.66 from $185.49 last week. Slaughter came in at 130,000 head which was well up from expectations. This would normally suggest stronger than expected demand from the packer. Slaughter was up from 123,000 head last week and up from 129,000 head a year ago as this time.
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