As trading closed on the last day for October contracts, prices jumped higher, while deferred contracts saw losses. Cash trade traded mostly steady over the week.
Live cattle futures were mixed over the week. The October contract gained over $4 to close at $193 on its last trading day, the December contract lost about $3 to close at $186.30 and the February contract gained several dollars to close at $186.77.
“A quick review of the futures contracts reminds us the consensus of price forecasting is calling for flat prices from now through the first half of next year,” the Cattle Report wrote on Thursday. “The proposition that fed prices have found a ceiling beyond which cattle owners will be unable to penetrate is disappointing to many who find future breakevens rising above the current price level.”
It is also a reminder that futures prices do not make the cash market, the Cattle Report added.
Cash trade through Thursday afternoon totaled about 80,000 head. Live steers sold from $187-192, and dressed steers sold from $296-298.
“Negotiated cash fed cattle traded at mostly steady this week as packers were willing to add to inventory at steady cattle costs even though boxed beef prices have topped,” wrote Cassie Fish, market analyst, in The Beef on Thursday. “Why? Because packer margins are still favorable and it’s a chance to bank another week of blank ink. Estimates are for another 620k-plus weekly slaughter.”
Cash trade for the week ending Oct. 28 totaled 98,023 head. Live steers averaged $190.03, and dressed steers averaged $298.98.
The national weekly direct beef type price distribution for the week of Oct. 14-21 was the following on a live basis:
• Negotiated purchases: $190.16.
• Formula net purchases: $190.53.
• Forward contract net purchases: $188.11.
• Negotiated grid net purchases: $191.77.
On a dressed basis:
• Negotiated purchases: $298.86.
• Formula net purchases: $300.91.
• Forward contract net purchases: $297.70.
• Negotiated grid net purchases: $299.96.
Slaughter through Thursday was about 490,000 head, slightly above the pace of a week earlier. Total slaughter for the week prior is estimated at 623,000 head. Actual slaughter for the week ending Oct. 19 was 607,284 head. The average steer dressed weight was 960 lbs., 10 lbs. above the prior week.
Boxed beef prices fell over the week, with the Choice cutout down about $4 to $317.60 and the Select cutout down about $9 to $285.37.
“Only the rib, no surprise there, is holding its seasonal own,” Fish said.
USDA released its latest Cattle on Feed report on Oct. 25. Cattle and calves on feed on Oct. 1 totaled 11.6 million head, slightly below a year ago. Placements totaled 2.16 million head, 2% below last year’s levels. Marketings totaled 1.7 million head, 2% higher, and other disappearance totaled 56,000 head, 2% below a year ago.
Feeder cattle
Feeder cattle futures were mixed over the week. The October contract gained $2.57 to close at $251.97 on its last trading day, the November contract lost $3.15 to close at $245.37 and the January contract lost $4.20 to close at $241.32.
“Even though demand has continued to remain strong in the countryside for both feeders and calves, and some of the recent moisture has helped feeding conditions, traders don’t seem concerned about anything besides the market’s technical state right now,” ShayLe Stewart, DTN livestock analyst, wrote in her Thursday midday comments.
The CME Feeder Cattle Index gained several dollars to close at $251.20.
Corn futures were lower over the week, the December contract down 11 cents to $4.10 and the March contract down 9 cents to $4.26.
Missouri: Joplin Regional Stockyards in Carthage sold 6,500 head on Monday. Compared to a week earlier, feeder steers sold steady to $4 higher and feeder heifers sold steady to $3 lower. Benchmark steers averaging 732 lbs. sold from $253-264, averaging $256.61.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 8,500 head on Monday. Compared to the previous sale, feeder cattle and calves sold steady and demand was good. Benchmark steers averaging 730 lbs. sold from $234-263, averaging $254.75.
Texas: Lonestar Stockyards in Wildorado sold 1,865 head on Tuesday. Compared to the last auction, feeder steers and heifers traded mostly steady on limited comparable sales. Heifer calves between 600-700 lbs. traded mostly $5 higher. There were not enough comparable sales on steer calves for a market trend, but a lower undertone was noted. A group of steers averaging 776 lbs. sold for $255.
Wyoming: Winter Livestock in Riverton sold 5,243 head on Tuesday. Compared to the last auction, steer calves under 500 lbs. sold $6-13 higher, with instances of $23-36 higher, over 500 lbs. were mostly steady, except 600-645 lbs. sold $17 higher. Heifer calves under 500 lbs. sold $9-11 higher, with instances of $22 higher, and over 500 lbs. were steady, except 600-635 lbs. traded $9 higher. Yearling heifers sold on a light offering, with instances of $4-10 lower. Benchmark steers averaging 720 lbs. sold for $242-257.50, averaging $245.08. — Anna Miller, WLJ managing editor
