Cattle traded $4.00-$5.00 higher on a live basis Wednesday as the futures market soared into new contract highs. Most trade occurred at $118.00 live, with a few early at $117.00. A few cattle in Nebraska traded as high as $119.00 live late in the day. Dressed trade ranged $188-$192, with the highest price coming from regional packers. Major packers paid as high as $190.

The choice cutout was up $1.60 at $176.87 last night, with the select up $0.87 at $175.57. Volume was the best for a Wednesday since December. Packer margins are now back into the black, which explains why they are willingly paying higher for cattle for next week. At some point, they will not be able to cover the difference; estimates are that they will need at least $7.00 on the cutout to make up for higher prices paid for cattle this week. With grilling demand just beginning and retailers rather short bought, however, it seems that it will be at least another week or two before we see significant resistance developing.

HOGS

Hog calls are mostly steady again this morning. Although fresh pork appears to have found a bottom, concern remains over ham demand. Packers are not willing to pay up for hogs in most cases until margins improve.

The pork cutout lost $0.42 last night. Loins were unquoted but are said to be in better shape than when they started the week. Butts were steady to 3 cents higher. Hams were quoted generally steady, but with weak undertones present. Sources report additional discounting may occur into the end of the week or early next week due to the large slaughter planned for the weekend. Some estimates are now as high as 75,000 head.

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TJE Cash trade information provided by Robin Fuller