Futures closed out the week higher as early cash trade prices stayed steady and cattle feeders held firm in negotiations.
Live cattle futures closed higher over the week. The June contract gained $1.65 to close at $209.65, and the August contract gained 55 cents to close at $204.65.
Cash trade through Thursday totaled about 85,000 head. Live steers sold from $214-224, and dressed steers sold from $340-350.
Cash trade for the week ending April 20 totaled 67,218 head. Live steers averaged $211.68, and dressed steers averaged $336.61.
“There are few times in history when cash prices have accelerated this dramatically,” wrote Cassie Fish, market analyst, in The Beef on Thursday. “Cattle feeders are holding packers’ feet to the fire in a way never seen before. The boot is on the other foot from the COVID times when packers made hundreds of dollars per head. It is the cattle feeders’ turn and they are making the most of it.”
ShayLe Stewart, DTN livestock analyst, wrote on Wednesday that on the packer side of the spectrum, “Packers are desperate to get ahead of the cash cattle market and they’re throwing every trick in the book at the marketplace to dramatically reduce throughput, including offering bids early in the week in hopes that some feedlot managers will get antsy and let some cattle go early.”
Slaughter through Thursday totaled about 465,000 head, compared to 466,000 head a week earlier. Total slaughter for a week earlier is estimated at 555,000 head. Actual slaughter for the week ending April 19 was 577,626 head. The average steer dressed weight was 946 lbs., the same as a week earlier.
“The current cattle feeding practice of pushing days on feed more and more, which increases the percentage of yield grade 4s and 5s has been the single most effective tool guaranteeing leverage for the cattle feeders,” Fish said. “Therefore, the packer has no choice but to undershoot slaughter plans for Q2 as cattle out-dates exceed the old norms.”
Boxed beef prices climbed higher over the week. The Choice cutout gained more than $12 to close at $343.17, and the Select cutout gained about $8 to close at $324.28.
“An even bigger surprise than cash jumping $6 bucks in a week is the wholesale beef market’s struggle to keep up,” Fish said. “Packers have sliced production five weeks in a row counting this week and it took until this week for the boxes to rally.”
Feeder cattle
Feeder cattle futures were higher over the week. The May contract gained more than $4 to close at $293.22, and the August contract gained $1.75 to close at $294.45.
“As the market seems to be showing that it’s finding some technical pressure, it’s likely feeder cattle prices will still be able to remain strong, despite what the board is doing, given that we are only weeks away from turn out season to grass, and that supplies are so thin,” Stewart said.
The CME Feeder Cattle Index was nearly $7 higher to close at $295.77.
Corn futures were lower, down 13 cents on the May contract to $4.64 and down 12 cents on the July contract to $4.72.
Missouri: Joplin Regional Stockyards in Carthage sold 9,000 head on Monday. Compared to the last sale, feeder steers sold $5-10 higher and feeder heifers sold steady to $15 higher. Benchmark steers averaging 764 lbs. sold from $292-325, averaging $306.63.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 4,900 head on Monday. Compared to a week earlier, feeder steers and steer calves sold $5-10 higher. Feeder heifers sold $7-13 higher. Heifer calves sold $5-10 higher. Benchmark steers averaging 771 lbs. sold from $286-313, averaging $302.13.
South Dakota: Sioux Falls Regional in Worthing sold 3,500 head on Monday. Compared to the previous sale, feeder steers were too limited a week earlier to offer a full comparison, but higher undertones were noted for all weights. The best comparison of heifers was those over 750 lbs., which sold $6-8 higher.
Wyoming: Torrington Livestock in Torrington sold 3,971 head on Wednesday. There were no trends noted as there was not a sale a week earlier. Several long strings of cattle were noted with sharply highly undertones. Benchmark steers averaging 765 lbs. sold from $299-333, averaging $315.66. — Anna Miller, WLJ managing editor
