August cattle closed slightly higher on the session yesterday after an early selloff that reached a three-session low. Ongoing demand concerns for the post-holiday period through mid-July were thought to be negative factor for prices early in the session. However, a turnaround in other agriculture markets, strength in energy and metal markets and a sharp selloff in the US Dollar were thought to ease global demand concerns for commodities and were widely seen as supporting a recovery that took prices higher for the session. Some traders feel the market may still be vulnerable to a corrective set-back for the nearby contracts, while deferred contracts may be significantly impacted by key grain reports released on Thursday morning. If corn prices are going to stay at historically high levels, the cattle production outlook for early 2012 will tighten further. Export demand news remains strong, and many traders see a weaker US Dollar as a supportive force. The estimated cattle slaughter came in at 131,000 head yesterday. This brings the total for the week so far to 261,000 head, up from 258,000 head last week at this time and up from 256,000 head a year ago. Boxed beef cutout values were up 82 cents at mid-session yesterday and closed 31 cents higher at $178.79. This was up from $176.32 the prior week and is the highest beef market since May 25th.
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