Futures slowed their roll on the board, trading on a higher note toward the beginning of the week but losing their momentum as the week advanced. Cash trade was slow to develop, trading a couple of dollars lower from a week earlier.
Live cattle futures traded mostly steady, but ultimately closed lower over the week. The June contract lost $1.20 to close at $177.57, and the August contract lost $1.18 to close at $171.07.
Cash trade through the week was slow to get started, with about 27,000 head sold through Thursday morning. Live steers sold from $181-188, averaging $186.80. Dressed steers sold from $287-300, averaging $295.99.
Cash trade through June 11 totaled an impressive 109,811 head. Live steers averaged $188.77, and dressed steers averaged $299.34.
“The packers purchased 110k head last week, 35k with time, the largest weekly negotiated trade of 2023 and likely enough to halt the sharp advance in cash cattle prices for now,” wrote Cassie Fish, market analyst, in The Beef on Monday.
“There is a lot of conversation now about just how much packers can back cash cattle prices down in the coming weeks,” she continued. “Included in that conversation is anecdotal evidence that fed cattle supplies will increase a bit in July. So, a dip back in to the 170s may be in the cards, though this may be easier said than done.”
The national weekly direct beef type price distribution for the week of June 5-12 was the following on a live basis:
• Negotiated purchases: $188.66.
• Formula net purchases: $183.98.
• Forward contract net purchases: $173.55.
• Negotiated grid net purchases: $178.38.
On a dressed basis:
• Negotiated purchases: $299.89.
• Formula net purchases: $285.46.
• Forward contract net purchases: $273.04.
• Negotiated grid net purchases: $285.05.
Slaughter through Thursday was estimated at 500,000 head. Slaughter a week earlier was projected at 621,000 head. Actual slaughter for the week ending June 3 was 568,423 head. The average dressed steer weight was 887 lbs., up 4 lbs. from the prior week.
Boxed beef prices continue to climb higher, higher, higher. Over the week, the Choice cutout gained about $14 to close at $342.07, and the Select cutout gained over $5 to close at $309.58.
“It is Q4 when numbers will become excruciatingly tight and packer margins will likely go consistently red,” Fish said. “In the meantime, the packer has managed to protect his margin well in midst of tightest supplies in years. It is probable retail beef prices will rise this summer.”
Feeder cattle
Feeder cattle futures were lower a few dollars. The August contract lost about $4.50 to close at $234.12, and the September contract lost about $4 to close at $237.52.
The CME Feeder Cattle Index gained $5.48 to close at $227.68.
Corn futures made gains, with the July contract up 13 cents to $6.23 and the September contract up 42 cents to $5.70.
“Some sellers in the country are tiring of finding their sales prices out of the money quickly following the consummation of the transaction,” wrote the Cattle Report. “More sellers are opting for competitive forums of live or video auctions but are finding the same problem when yesterday’s sale price is obliterated by new higher prices. Sometimes increased receipts at sale barns are cattle purchased at one sale and jockeyed to another sale for quick resale.
Kansas: Winter Livestock in Dodge City sold 1,328 head on Wednesday. Compared to a week earlier, feeder steers 725-925 lbs. sold $3-4 lower. There were not enough steers 400-725 lbs. for a market test. Feeder heifers 675-900 lbs. sold $3-4 lower on light receipts. Benchmark steers averaging 788 lbs. sold from $221-230, averaging $228.49.
Missouri: Joplin Regional Stockyards in Carthage sold 10,000 head on Monday. Compared to a week earlier, feeder steers under 625 lbs. sold steady to $5 lower, with heavier weights selling steady to $3 higher. Feeder heifers under 575 lbs. sold $3-10 lower, with heavier weights selling steady to $3 higher. Benchmark steers averaging 732 lbs. sold from $222-250, averaging $232.10.
Nebraska: Tri-State Livestock in McCook sold 1,165 head Monday. There were not enough sales for an accurate comparison. Benchmark steers averaging 793 lbs. sold between $229-231, averaging $229.21.
New Mexico: Clovis Livestock in Clovis sold 1,354 head Wednesday. Compared to the last auction, steer calves were $4 lower, with the exception of 400-450 lbs. selling $2 higher. Feeder steers were $1-6 higher. Heifer calves sold sharply lower on comparable sales, with the exception of 400-450 lbs. held steady. Feeder heifers were significantly lower, except 800-850 lbs. sold $1 higher. Benchmark steers averaging 727 lbs. sold between $220-231, averaging $228.13.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 10,750 head on Monday. Compared to a week earlier, feeder steers and heifers sold mostly steady. Steer and heifer calves sold $4-6 lower. Benchmark steers averaging 771 lbs. sold from $217-238, averaging $230.98.
South Dakota: Sioux Falls Regional Cattle Auction in Worthing sold 2,006 head Monday. Compared to the last auction, steers and heifers sold with steady to lower undertones on a light test. Benchmark steers averaging 790 lbs. sold between $232-240 and averaged $238.95. — Anna Miller, WLJ managing editor
