June cattle closed sharply higher on the day, with the market experiencing the highest close since March 29th. Talk of a sharp drop in placements for April and likely May as well plus continued talk that beef demand will rise during active consumption weekends just ahead helped to support. The premium of cash cattle over futures prices could keep feedlots active at moving cattle over the near-term, which should help keep feedlots current with their marketings and push average weights lower. However, the current cash premium may also encourage short-term movement of cattle to market as well as holding short-term supply at higher than expected levels. Ideas that on-feed inventories will trend lower during the months ahead helped to support the market, and the discount of futures to cash prices was also seen as a positive force. There are market forecasts for a sharp drop in placements during April, which helped to support the deferred contracts with the December contract up 4 sessions in a row. Many traders see On-Feed supply on May 1st at just slightly above last year near 100.3%. Placements in April are expected to be down 10% to 12% from last year, and marketings are forecast to be down 1% to 2%. Weekly U.S. beef export sales for the week ending May 10th came in at 14,400 metric tonnes, compared with the prior 4-week average of 17,700 tonnes. Cumulative sales for 2012 have reached 395,000 metric tonnes, up 4.4% from last year's pace. Slaughter came in higher than expected at 128,000 head, which could be a sign of stronger than expected demand from packers. This brings the total for the week so far to 505,000 head, up from 497,000 head last week at this time but down from 516,000 head a year ago. Boxed beef cutout values were up 24 cents at mid-session yesterday, and closed 12 cents higher at $191.10. This was up from $189.92 the prior week. Average dressed steer weights for the week ending May 5th came in at 832 pounds, up from 828 pounds the previous week and up 2% from a year ago. Beef production for the same week came in at 485.1 million pounds, up 3.57% over year ago.
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