Tuesday markets
The cattle complex traded within a narrow range, setting up trade to go either way as the week progresses, but closed lower.
Live cattle futures were lower, with the December contract down 17 cents to $136.77 and the February contract down 55 cents to $138.30.
Cash trade was light today, with 3,479 head selling at $138. Dressed steers sold between $216-220, averaging $219.14. Negotiated cash trade in Kansas has been limited on light demand. A few live purchases traded at $138. In the Texas Panhandle, Nebraska and the western Corn Belt, negotiated cash trading has been mostly inactive with light demand. On the formula side, 26,700 head averaging 901 lbs. sold for $226.13.
“Hopes for continued higher cash through the end of the year had been dashed with cash price weakness last week,” wrote Robin Schmahl, DTN contributing analyst, in the Early Word Livestock comments. “Now, there is concern cash may trade a little lower this week as packers seem to have set themselves up well through the end of the year with quite a few deferred cattle already on the books. They will still purchase cattle but likely at no better than steady money. It will be up to feedlots as to how aggressive they want to move cattle by the end of the year.”
The national weekly direct beef type price distribution for the week of Dec. 6 to Dec. 13 was the following on a live basis:
• Negotiated purchases: $139.49.
• Formula net purchases: $142.81.
• Forward contract net purchases: $133.97.
• Negotiated grid net purchases: $141.38.
On a dressed basis:
• Negotiated purchases: $219.79.
• Formula net purchases: $226.12.
• Forward contract net purchases: $205.59.
• Negotiated grid net purchases: $217.12.
Slaughter for the day is expected to be 122,000 head, a thousand below last week. USDA’s Agricultural Marketing Service released the National Weekly Fed Cattle Comprehensive report, showing quality grading was up 0.1 percent to 81.3 percent, and dressed weights were up 6.5 lbs. to 898.8 lbs.
Boxed beef prices closed lower on 146 loads, with the Choice cutout down $2.50 to $260.72 and the Select cutout down $4.84 to $248.80. The Choice/Select spread is $11.92.
“There was some good news found in the USDA’s Comprehensive Boxed Beef report released yesterday,” said Cassie Fish, market analyst for The Beef. “Last week saw another solid week of wholesale beef sales and an increase in +22 day bookings was noted, indicating that lower wholesale prices were attracting end-user buying interest.”
According to CME’s Daily Livestock Report, the Choice beef cutout is down $20/cwt or 7 percent for the past month.
Feeder cattle
Feeder cattle closed lower on higher grain futures. The January contract was down 95 cents to $164.57, and the March contract was down 7 cents to $166.40. The CME Feeder Cattle Index was down 39 cents to $161.77.
“Thus far throughout the week, there have been large runs of calves selling in sale barns as producers realize this week is really their last chance to market any calves before the year’s end,” wrote ShayLe Stewart, DTN livestock analyst, in the midday comments. “Prices are seeing a little pushback as corn prices are making buyers cautious. But, all in all, buyers are still interested and want to have cattle on to market in 2022.”
Corn contracts closed higher, with the December contract up 4 cents to $5.88 and March up 5 cents to $5.90 a bushel. January soybean meal was up $14.80.
Nebraska: Tri-State Livestock in McCook sold 1,280 head on Monday. Compared to the previous auction, steers under 650 lbs. were $4-10 lower, and steers over 650 lbs. were $4-7 higher. There were not enough heifers for a comparison. Benchmark steers averaging 784 lbs. sold between $163.50-167.75 and averaged $166.20.
South Dakota: Sioux Falls Regional Livestock sold 5,078 head on Monday. Compared to the last auction, feeder steers under 450 lbs. sold with significantly higher undertones, 450-500 lbs. were steady to $2 lower and over 500 lbs. were steady to $5 higher. Feeder heifers 450 lbs. and under sold with significantly higher undertones. Over 450 lbs. were steady to $4 higher, except 550-650 lbs., which sold $3-5 lower. Benchmark steers averaging 777 lbs. sold between $157.25-171.50, averaging $164.46. — Charles Wallace, WLJ editor
