The cattle market took a step back this week, trading moderately lower amid higher corn prices.
Live cattle futures traded sideways over the week. The June contract closed about 10 cents higher to $177.65, and the August contract closed about 8 cents higher to $171.15.
Cash trade through Thursday totaled about 69,000 head. Live steers sold from $178-186, averaging $183.76. Dressed steers sold from $288-292, averaging $290.54.
“Show lists this week were larger in all regions following small purchases by the packers last week,” wrote the Cattle Report on Wednesday. “Processing margins widened last week to allow more generous returns and the slaughter rates are likely to increase. Lower box prices this week will allow retailers some relief from squeezed margins on beef.”
Cash trade through the week ending June 18 totaled 61,327 head. Live steers averaged $185, and dressed steers averaged $296.10.
The national weekly direct beef type price distribution for the week of June 12-19 was the following on a live basis:
• Negotiated purchases: $184.82.
• Formula net purchases: $188.82.
• Forward contract net purchases: $173.44.
• Negotiated grid net purchases: $184.82.
On a dressed basis:
• Negotiated purchases: $295.86.
• Formula net purchases: $296.40.
• Forward contract net purchases: $270.49.
• Negotiated grid net purchases: $291.31.
Slaughter through Thursday was estimated at 503,000 head, a few thousand head more than a week earlier. Slaughter for a week earlier was estimated at 634,000 head. Actual slaughter for the week ending June 10 was 616,547 head. The average dressed steer weight was 882 lbs., down 5 lbs. from the prior week.
“There is talk that this week’s fed slaughter will increase with more plants running on Saturday. That remains to be seen,” wrote Cassie Fish, market analyst, in The Beef on Thursday. “If it materializes, then perhaps the fed slaughter will get back above 500k head, where it would normally be in June, even a June with tighter supplies. This same week in June 2016 saw a 500k head fed kill.”
Boxed beef prices were several dollars lower. The Choice cutout lost about $8 to $334.47, and the Select cutout lost about $6 to close at $303.80.
Feeder cattle
“Unfortunately, even though the cattle complex remains in a strong position with limited supplies and superb demand, the market is rattled by the concern on sharply higher feed prices,” ShayLe Stewart, DTN livestock analyst, wrote in her Wednesday midday comments. “Feeder cattle buyers have a hard time figuring a profitable breakeven when both feeder cattle and feed prices are high.”
Feeder cattle futures were about $3 lower apiece. The August contract closed at $230.67, and the September contract closed at $234.52.
The CME Feeder Cattle Index lost about $6 to close at $221.73.
Corn prices found momentum, up about 40 cents on each contract. The July contract closed at $6.60, and the September contract closed at $6.17.
Kansas: Winter Livestock in Dodge City sold 908 head Wednesday. Compared to the last auction, feeder steers 850-950 lbs. sold steady. There were not enough steers between 400-850 lbs. for a market test. There were not enough heifers for a market test; however, approximately 117 heifers weighing 714 lbs. sold for $223. A group of steers averaging 741 lbs. sold between $215-221 and averaged $215.84.
Missouri: Joplin Regional Stockyards in Carthage sold 8,500 head on Monday. Compared to a week earlier, feeder steers sold steady and heifer calves sold $2-4 lower. Benchmark steers averaging 720 lbs. sold from $229-237, averaging $232.46.
New Mexico: Roswell Livestock in Roswell sold 1,168 head Monday. Compared to the last auction, steer calves 300-350 lbs. sold $3 higher and 450-550 lbs. sold $6-7 lower. Feeder steers 600-650 lbs. sold $4 higher. Heifer calves 300-350 lbs. sold steady, 350-400 lbs. sold $4 higher and 450-500 lbs. were $13 higher, while 500-550 lbs. sold $4 higher. Feeder heifers 600-650 lbs. were $4 lower, and 650-700 lbs. sold $3 higher. A group of steers averaging 768 lbs. sold between $212-220 and averaged $215.22.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 6,100 head on Monday. Compared to the prior sale, feeder steers sold steady to $2 lower. Heifers sold steady to $3 higher. Steer calves sold unevenly steady, and heifer calves sold steady to $2 higher. Benchmark steers averaging 769 lbs. sold from $221-240, averaging $227.53.
South Dakota: Sioux Falls Regional Cattle Auction sold 1,337 head on Monday. Compared to the sale a week earlier, feeder steers and heifers sold with significantly lower undertones. Demand was moderate. Benchmark steers averaging 783 lbs. sold from $223-230, averaging $227.68. — Anna Miller, WLJ managing editor
