Cattle futures posted strong gains again this past week, fueled by expectations of stronger cash trade and strengthening boxed beef prices.
Live cattle futures saw several-dollar gains over the week. The October contract gained more than $8 to close at $243.95, and the December contract also gained about $8 to close at $247.87.
“With the anticipation that fed cash cattle prices will trade higher again this week; traders are continuing to push the live cattle contracts higher into Thursday’s noon hour,” wrote ShayLe Stewart, DTN livestock analyst, in her Thursday midday comments.
Cash trade through Thursday totaled about 6,000 head. Live steers sold from $238-240 and dressed steers sold from $372-373.
“Packers need inventory and know they’ll be paying dollars higher,” wrote Cassie Fish, market analyst, in The Beef on Thursday. “That’s just the way it goes in a bull market coming off of a low. It’s generally impossible to own enough inventory when a market turns. The level of the trade volume this week will be key because tighter fed cattle supplies are on deck in November, December and beyond.”
Cash trade for the week ending Oct. 12 was 54,151 head. Live steers averaged $234.07, and dressed steers averaged $362.52.
Slaughter through Thursday totaled about 466,000 head, compared to 446,000 head a week earlier. Total slaughter for a week earlier, as well as actual slaughter for two weeks earlier, is unavailable from USDA National Agricultural Statistics Service due to the government shutdown.
“Beef is the biggest bang at the cash register for grocers (besides liquor) and it is their highest priority to make certain beautiful beef items are available for consumers to take home,” Fish said. “High end dining demand also increases in November and December. So packers are under pressure to try and meet end users needs.”
Boxed beef prices were steady to higher over the week. The Choice cutout gained about a dollar to close at $366.11, and the Select cutout gained about $4 to close at $348.93.
Feeder cattle
Feeder cattle futures also saw several-dollar gains over the week. The October contract gained about $5 to close at $379.67, and the November contract gained about $6 to close at $380.95.
The CME Feeder Cattle Index gained nearly $9 to close at $374.47.
“Demand has been utterly incredible this week in sales across the countryside, as shown by the CME Feeder Cattle Index’s rally, which reached a new all-time high at $374.47,” Stewart said.
Corn futures were sideways over the week, up 3 cents on the December contract to $4.21 and up a penny on the March contract to $4.35.
Colorado: Winter Livestock in La Junta sold 2,036 head on Tuesday. Compared to a week earlier, feeder steers under 400 lbs. sold $4-7 lower. Feeder steers over 400 lbs. sold sharply higher. Feeder heifers sold sharply higher across all weight classes. Benchmark steers averaging 706 lbs. sold from $377-392, averaging $387.01.
Missouri: Joplin Regional Stockyards in Carthage sold 7,500 head on Monday. Compared to the previous auction, at the mid-session, feeder steers sold steady to $10 higher, with feeder heifers selling $5-15 higher. Benchmark steers averaging 721 lbs. sold from $375-411 and averaged $403.39.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 5,500 head on Monday. Compared to the previous auction, at the mid-session, feeder steers sold $10-20 higher and feeder heifers traded $5-15 higher. Steer and heifer calves sold $20-30 higher. Benchmark steers averaging 766 lbs. sold from $372-388, and averaged $383.65.
Texas: Giddings Livestock in Giddings sold 1,208 head on Monday. Compared to the previous auction, feeder steers and heifers were steady. A group of steers averaging 662 lbs. sold from $330-365, averaging $340.48. — Anna Miller Fortozo, WLJ managing editor
