Wednesday markets
Cattle futures sank lower today, while cash trade has blossomed with more than 100,000 head sold so far this week. In other market-related news, the House of Representatives held a 5 1/2 hour hearing today on price discovery and transparency in the cattle markets. To view the hearing, click here.
Live cattle futures headed lower. The April contract lost $1.50 to close at $138.50, and the June contract lost $1.22 to close at $135.02.
There was some cash trade today, with most of the sales happening earlier yesterday, bringing the total so far to over 100,000 head. A total of 9,378 head sold today, with live steers averaging $145.75 and dressed steers averaging $232. On the formula side, a total of 14,900 head averaging 860 lbs. sold for an average of $225.48.
“It would appear that the packer is strategically loading up ahead the anticipated seasonal increase,” wrote Cassie Fish, market analyst, in The Beef. “ Fed cattle slaughter levels will be large in May and June, likely the largest of 2022.”
Slaughter for the day is estimated at 125,000 head, bringing the week’s total so far to 375,000 head. The same time last week, slaughter totaled 361,000 head.
Boxed beef prices were lower on 160 loads. The Choice cutout lost $261.91, and the Select cutout lost $3.91 to close at $252.32.
“A seasonal increase in wholesale values is widely anticipated for the month of May and many expect wholesale values to reach a new high for the spring prior to Memorial Day,” Fish said. “Packer margins have narrowed yet again this week.”
Feeder cattle
Feeder cattle futures dived lower on all contracts except the closest April contract. The April contract was unchanged at $156.20, but the May contract lost $3.37 to close at $157.35.
The CME Feeder Cattle Index gained 9 cents to close at $156.21.
Corn futures were higher, with the May contract up 12 cents to $8.15 and the July contract up 10 cents to $8.12.
“High grain prices will continue to be a challenge for cattle buyers, but if the countryside starts to see pastures green up and grass able to grow, then some optimism could bloom,” wrote ShayLe Stewart, DTN livestock analyst.
Colorado: Winter Livestock in La Junta sold 499 head on Tuesday. Compared with a week earlier, feeder steers and heifers under 500 lbs. were too lightly tested for a comparison, steers 500-700 lbs. sold $2-3 higher in a light test and over 700 lbs. sold steady. Heifers weighing 500-700 lbs. sold mostly steady, and over 700 lbs. sold $1-2 higher. Benchmark steers averaging 613 lbs. sold for $186. — Anna Miller, WLJ managing editor
