Cattle futures moved lower over the week as uncertainty continued about whether employees at a major Colorado packing plant were going to strike.
Live cattle futures closed lower over the week. The February contract lost $1.50 to close at $246, and the April contract lost about $6.50 to close at $236.90.
“What’s behind today’s sell-off is likely nervousness that the UFCW union at the Greeley, Colorado fed cattle slaughter and processing plant might decide tonight to strike,” wrote Cassie Fish, market analyst, in The Beef on Thursday. “The union has held three registration events this week so members can register to be paid if a strike is initiated. The last sign up ends this evening at 7 p.m. Mountain time. Lots of people have lots of opinions on whether or not the strike will take place, but at this juncture, it is all speculation.”
Cash trade through Thursday totaled about 18,000 head. Live steers sold from $242-244, and dressed steers sold from $382-384.
“There was some light trade at weaker money in the north, but so far, most are passing,” Fish said. “Cattle feeders seem confident that their leverage remains strong, strike or no strike.”
Cash trade for the week ending Feb. 23 totaled 74,704 head. Live steers averaged $246.65, and dressed steers averaged $387.90.
Slaughter through Thursday totaled about 427,000 head, on pace with a week earlier. Total slaughter for a week earlier is projected at 516,000 head. Actual slaughter for the week ending Feb. 14 was 543,582 head. The average steer dressed weight was 984 lbs., up 2 lbs. from the prior week.
Boxed beef prices were higher over the week, up more than $12 on the Choice cutout to $377.89 and up $11 on the Select cutout to $370.79.
“Hard to reason that a late February rally of that magnitude had anything other than to do with ‘buying just in case,’” Fish said. “After all, slaughter disruptions historically have meant a big rally in boxes and the Greeley plant is one of the larger capacity fed cattle plants in the U.S. If there is a strike, the duration of the disruption is the key to determining its short and long-term impact.”
USDA released its latest Cattle on Feed report on Feb. 20. As of Feb. 1, the number of cattle and calves on feed was 2% lower than a year earlier. Placements were 5% lower, and marketings were 13% lower. Total disappearance was 8% lower.
Feeder cattle
Feeder cattle futures closed lower over the week. The March contract lost about $9 to close at $361.65, and the April contract also lost about $9 to close at $358.75.
“Without seeing the live cattle contracts trading higher—and still no reassurance as to what’s going to come of this week’s fed cash cattle trade—the feeder cattle contracts are left to trade sharply lower,” ShayLe Stewart, DTN livestock analyst, wrote in her Thursday midday comments.
The CME Feeder Cattle Index lost over a dollar to close at $374.79.
Corn futures traded higher, up 8 cents to $4.33 on the March contract and up 8 cents to $4.43 on the May contract.
Colorado: Winter Livestock in La Junta sold 1,389 head on Tuesday. Compared to the last auction, feeder steers under 600 lbs. sold $5-6 lower, and those over 600 lbs. sold $5-7 higher, with some sharply higher. Feeder heifers sold mostly $7-8 higher, with instances of sharply higher across all weight classes. Benchmark steers averaging 730 lbs. sold between $388-400, averaging $390.96.
Missouri: Joplin Regional Stockyards in Carthage sold 10,000 head on Monday. Compared to a week earlier, at the mid-session, feeder steers sold from $10 lower to $15 higher. Feeder heifers under 550 lbs. sold $5-10 lower, and heavier weights sold steady to $10 higher. Benchmark steers averaging 783 lbs. sold from $360-396, averaging $371.68.
New Mexico: Roswell Livestock in Roswell sold 1,131 head on Monday. Compared to the last auction, steer and heifer calves sold steady to lower, and feeder steers 700-900 lbs. sold higher. There were no comparable sales or numbers of feeder heifers for an accurate comparison. Benchmark steers averaging 709 lbs. sold between $375-388, averaging $386.15.
Oklahoma: Oklahoma National Stockyards sold 6,200 head on Monday. Compared to the sale held a week earlier, feeder steers and heifers sold steady to $3 lower and 600-700-lb. steers sold $10-15 higher. Steer calves sold steady to $5 higher, and heifer calves sold up to $25 higher. Benchmark steers averaging 772 lbs. sold from $350-377, averaging $371.55.
South Dakota: Sioux Falls Regional in Worthing sold 5,689 head on Monday. Compared to the last auction, feeder steers and heifers sold $3-5 lower, with instances of $10 lower. Benchmark steers averaging 726 lbs. sold between $375-420, averaging $399.07. — Anna Miller Fortozo, WLJ managing editor
