Futures contracts posted strong gains, supported by rising boxed beef prices and expectations of higher cash trade, despite limited activity through Thursday afternoon.
The agricultural markets closed at noon CT on Thursday in observance of the national day of mourning for former President Jimmy Carter’s passing.
Live cattle futures closed on Thursday just shy of the $200 mark. The February contract gained about $5 to close at $198, and the April contract gained about $2 to close at $198.70.
“It is helping that boxed beef prices are fully higher, and it’s still assumed that cash cattle prices will be higher again too this week although no trade has surfaced at this point,” wrote ShayLe Stewart, DTN livestock analyst, in her Thursday midday comments.
Cash trade through Thursday totaled about 4,000 head. Live steers sold for $200.
“The same problem that has plagued beef packers continues to be an issue—being able to purchase enough volume each week,” wrote Cassie Fish, market analyst, in The Beef on Thursday. “As a result, slaughter schedules are expected to be reduced as packers battle red ink and need to support cutout values.”
Cash trade for the week ending Jan. 5 totaled 85,514 head. Live steers averaged $198.90, dressed steers averaged $314.99.
Slaughter for Thursday is estimated at 479,000 head, compared to 350,000 head a week earlier. Total slaughter for the week ending Jan. 6 is expected to be 489,000 head. Actual slaughter for the week ending Dec. 28 was unavailable ahead of WLJ press time due to the federal holiday.
Boxed beef prices found easy momentum over the week, up more than $7 on the Choice cutout to $330.78 and up $14 on the Select cutout to $308.35.
The industry is eagerly waiting for the release of USDA’s annual Cattle inventory report at the end of the month, which will give a clearer look at inventory levels. Last year’s calf crop is expected to have declined by at least 1% compared to 2023, and the overall beef cow herd is expected to be smaller.
Feeder cattle
Feeder cattle futures were a couple dollars higher over the week. The January contract gained about $2 to close at $269.62, and the March contract also gained about $2 to close at $268.72.
The CME Feeder Cattle Index closed $11 higher to $272.86.
Corn futures were modestly lower, down 3 cents to $4.56 and $4.64 on the March and May contracts, respectively.
“I think it’s safe to assume that buyer demand remains red hot in the countryside which could be partially why traders have again decided the best direction for the contracts is higher,” Stewart said.
Iowa: Russell Livestock in Russell sold 4,916 head on Monday. Due to the lack of a recent auction, an accurate comparison could not be provided. Benchmark steers averaging 788 lbs. sold for $250-272, averaging $264.16.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 7,500 head on Monday. Compared to the last sale, feeder steers and steer calves sold $2-6 higher. Feeder heifers sold $3-4 higher, and heifer calves sold $2-7 higher. Feeders and calves saw instances of up to $15 higher in spots. Benchmark steers averaging 766 lbs. sold from $261-287, averaging $269.65.
Missouri: Joplin Regional Stockyards in Carthage sold 1,847 head on Monday. There were limited receipts due to weather and therefore no market comparison. Benchmark steers averaging 778 lbs. sold from $261-266, averaging $263.07.
South Dakota: Sioux Falls Regional in Worthing sold 6,016 head on Monday. An accurate comparison was unavailable due to no recent auction, but higher undertones on all weights of steers and heifers were noted. Benchmark steers averaging 768 lbs. sold for $268-288, averaging $280.22. — Anna Miller, WLJ managing editor
