June cattle closed moderately lower on the session yesterday, pushing to new lows on the day right into the 12:00 timeframe as outside market forces were thought to be a positive factor. However, many traders remained concerned over the rapid and severe sell-off in beef prices, which was thought to have helped to drive the market lower yesterday. The deferred contracts traded slightly higher due to strength in the grain markets and a more positive tone from outside market forces. The discount of June cattle to the cash market appears to be a limiting factor for the downside. Very high temperatures in Kansas, Oklahoma and Texas over the weekend may have slowed weight gains for feedlot cattle. The June cattle remains at a significant discount to last week's cash market, as many traders project a steady downtrend in cash cattle during the weeks ahead. Traders see cash at $113.00-$114.00 this week from $115.00 last week. With recent weakness in beef prices, the market is likely to continue to hold at a discount. The estimated cattle slaughter came in at 130,000 head yesterday which was a bit higher than expected and could suggest firm packer demand. This was up from 128,000 head last week and up from 129,000 head a year ago as this time. Boxed beef cutout values were up 19 cents at mid-session yesterday and closed 5 cents higher at $177.20. This was down from $181.79 the prior week.
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