Live cattle traded mostly sideways all week while feeder cattle bounced around on either side of the market, settling slightly higher than the week prior. Cash trade also picked up its momentum compared to recent weeks’ volume.
Live cattle contracts were down slightly from the week prior, with the February contract at $115.32 and the April contract at $123.12.
The cash cattle market experienced more volume throughout the week compared to prior weeks, which relied mostly on the latter part of the week for much trade to take place. Cash prices were around $114 for live cattle and $180 for dressed steers. These prices are the highest since Memorial Day week in 2020. A total of 102,508 head traded the first week of February, averaging $113.62 for live steers and $179.23 for dressed steers.
“With the drastically cold temperatures the country has faced this week, the cash cattle market sits in the fine position to demand higher prices, although packers are scrambling to find an out as opposed to paying more again this week,” ShayLe Stewart, DTN livestock analyst, commented in her Thursday midday comments.
Slaughter as of Thursday was projected at 461,000 head, several thousand head below the week and year prior—likely as a result of a Cargill plant down for maintenance. Slaughter for the first week of February is estimated at 653,000 head.
Boxed beef prices traded mixed all week, but ultimately ended Thursday a few dollars short of the week prior, with the Choice cutout at $232.96 and the Select cutout at $220.29.
The Sterling Profit Tracker reported packer margins at $392.41 per head for the first week of February. This was a slight increase of about $3 per head, but a month prior packers were making $157.32 per head. Feedlot margins decreased as a result of rising feed costs, bringing the margin to $24.82 per head, compared to $47.66 per head a week prior.
The Livestock Marketing Information Center’s (LMIC) prediction for the Feb. 1 Cattle on Feed Report (which comes out in late February) is for cattle on feed to be up just under a percent; January placements down about 0.8 percent; and marketings down about 6 percent. Katelyn McCullock, LMIC director, noted there were two less slaughter days in January 2021 versus January 2020.
Feeder cattle
Feeder cattle have been on an upward trend with the corn contract losing some weight after a recent bearish WASDE report. However, the trend lasted only for a couple of days before the March corn contract found its momentum again.
As of Thursday, the March feeder cattle contract was sitting at $139.15 and the April contract at $143.47, about a dollar higher than the previous week, respectively. The latest CME Feeder Cattle Index was reported at $135.49, down from the week prior. March corn was down a few pennies from the week prior at $5.41.
“With temperatures as bitterly cold as they are, across the nation cattle stress indexes have spiked as cattle go from using their rations to digest and convert feed into extra pounds to now using their feed as a heat resource and are trying to simply maintain condition through the adverse conditions,” Stewart said.
Colorado: Winter Livestock in La Junta sold 3,344 head Tuesday. Compared to the previous sale, feeder steers under 550 lbs. sold steady to $2 lower; 550-700 lbs. sold $3-5 higher; over 700 lbs. sold steady to $1 higher. Feeder heifers under 550 lbs. sold mostly steady, with instances of $5 higher on thin-fleshed fancy lots; 550-700 lbs. sold $1-3 higher; over 700 lbs. sold steady.
Missouri: Joplin Regional Stockyards in Carthage sold 2,928 head Monday. Compared to the last sale, steers and heifers under 700 lbs. traded $2-5 lower, and over 700 lbs. traded steady. Benchmark steers averaging 730 lbs. sold between $132-140.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 7,200 head Monday. Compared to the week prior, feeder steers sold steady to $2 lower where tested. Steer calves sold mostly $4-8 lower. Feeder heifers and heifer calves sold unevenly steady. Benchmark steers averaging 730 lbs. sold between $133-138.
South Dakota: Sioux Falls Regional Cattle Auction in Worthing sold 2,893 head Monday. Compared to the prior sale, feeder steers sold unevenly steady and feeder heifers sold steady to $4 lower except 500-600 lbs. sold $8-10 higher. Demand for this lighter offering of feeder cattle was good this week. Receipts were lighter with the artic weather that is crossing the Midwest. Benchmark steers averaging 778 lbs. sold between $135.50-144. — Anna Miller, WLJ editor
