Showlists should be even to smaller this week, but there are some ideas that cattle feeders may pull cattle ahead due to the good prices. This could result in larger lists. Asking prices will be higher. Asking prices in the south will start the week at $115.00 or better. Packer margins will start the week in the red, so trade may hold off a few days as they see just how far they can push beef prices.

The choice cutout was up $0.91 at $173.79 Friday night, with the select up $0.74 at $172.62. Spot volume was limited once again and the weekly total of graded cuts fell short of the previous week's limited trade. Beef cutout values continued to grind higher during the week, though packer margins were still pretty poor on Friday. Given the higher price paid for cattle this week's slaughter, packers will be under the gun to continue price increases. It is no surprise that slaughter was reduced into the weekend, giving a weekly total down 9,000 head from the previous week.

This weekend's beef clearance will be extremely important for the market going forward. It was a pay day weekend and should be indicative of beef demand into Lent.

HOGS

Hog calls are steady/weak this morning. Weather - snow in the west, flooding in the east - may be an issue in some areas, but packers have good numbers under their belt coming into the week and bids will be no better than steady. Slaughter totaled 2.14 mill head last week, larger than most of the trade expected at the beginning of the week.

The pork cutout gained $0.86 Friday night. Export demand from S. Korea faded a bit this past week due to a combination of logistic problems and rumors of issues with lines of credit. Butts broke back well below $1.20, and ended the week at $1.15 on the weighted average. Hams also set back on reduced export demand. We heard of waning Mexican demand even as a proposed deal between the US and Mexico on trucking was announced. While this proposed deal would result in the lifting of the 5% tariff on hams, we note there is a great deal of difference between a proposed deal and a done deal.

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For more information or trading ideas about this market, Please contact us at (800)254-1753 or email us at sales@linngroup.com

TJE Cash trade information provided by Robin Fuller