Wednesday markets
Commodities and equities reacted favorably to the Consumer Price Index increase of 8.5 percent, as analysts expected a higher increase. Live and feeder cattle closed up triple digits.
The Daily Livestock Report stated the decline in fuel costs helped offset increases in food, medical services, electricity and new cars. Food-at-home inflation in July was 1.3 percent higher than the previous month.
“In July, overall beef prices were up 3.4 percent from the previous year. However, inflation for ground beef was up 9.7 percent year over year, while inflation for roasts was up 1.5 percent and inflation for steaks was down 1.5 percent,” wrote the Daily Livestock Report. They continued that it helps that boxed beef prices are lower compared to last year.
Live cattle closed higher, with the August contract up $1.22 to $139.20 and the October contract up $1.30 to $144.47.
Cash trade was somewhat active, with 14,740 head selling between $139-146, averaging $145.45. Dressed steers averaged $228.84. USDA reported dressed steers sold in Nebraska between $228-232 and in Iowa for $227-232.
On the formula side, 26,200 head averaging 854 lbs. sold for $221.63.
“The heat is moderating in most of the country after a blistering July,” the Ag Center wrote in the Cattle Report. “Rains have also benefited some drought areas of the southern plains. Replacement cattle prices are showing signs of wanting to surge, but higher grain prices will keep increases in check. Crop status reports will create volatility in grain prices and then transfer to livestock futures.”
Slaughter is projected to be 126,000 head, 2,000 head above last week.
Boxed beef prices were lower on 123 loads, with the Choice cutout down $1.50 to $263.23 and the Select cutout down 62 cents to $237.08.
Feeder cattle
Feeder cattle closed higher, with the August contract up $1.87 to $180.67 and the September contract up $2.50 to $185. The CME Feeder Cattle Index was up 13 cents to $176.53.
“Higher feeder cattle futures prices Wednesday have so far displayed a surprising imperviousness to the double-digit gains in corn futures, but some deferred contracts are starting to slip into the red as more of the day’s trading volume accumulates,” Elaine Kub, DTN contributing analyst, wrote in the midday comments.
Corn closed higher, with the September contract up 5 cents to $6.21 and the December contract up 4 cents to $6.18.
Nebraska: Tri-State Livestock in McCook sold 1,100 head Monday. Compared to the previous auction, steer calves were $9-12 lower, and heifers were $5-10 higher. There were not enough feeder cattle to make a test. A group of steers averaging 790 lbs. sold for $176.50.
Texas: Lonestar Stockyards in Wildorado sold 1,524 head Tuesday. Compared to the last auction, feeder steers traded $1-6 higher. Steer calves traded mostly firm, with the exception of 500-550 lb. steers, which were $4 lower. All classes of heifers sold steady to $2 higher on comparable sales. Benchmark steers averaging 776 lbs. sold for $170.50. — Charles Wallace, WLJ editor
