Wednesday markets
Futures were lower today, although cash trade finally found some momentum.
Live cattle futures were lower, with the February contract down 22 cents to $143.12 and the April contract down 25 cents to $146.92.
Cash trade was active today, with 35,094 head sold. Live steers sold between $141-143, averaging $142.08. Dressed steers sold between $224-226, averaging $225.96. Cash trade through Wednesday morning totaled about 36,000 head. On the formula side, a total of 12,700 head averaging 866 lbs. sold for an average of $227.41.
“For those operating in the cash markets for cattle and grain, the improvement in fed cattle prices has not resulted in reasonable profits for the past few months,” the Cattle Report wrote. “Each improvement in pricing has been accompanied by increases in feed cost, leaving the close-out outcome sitting on the margins of profitability. Additionally, each new purchase brings a new higher breakeven for the future.”
Slaughter for the day is projected at 122,000 head, on par with last Wednesday. Slaughter to date this week is estimated at 366,000 head, a thousand head more than the same time last week.
Boxed beef prices were lower on 111 loads. The Choice cutout lost 75 cents to close at $269.62, and the Select cutout lost $1.74 to close at $266.08.
“Retailers may find an opportunity to realign their costs of beef and return stores to more competitive pricing,” the Cattle Report wrote. “With the rise in pork prices coupled with reports of bird flu in some chicken operations, beef may move back into play at the meat counter. Beef has played the poster child for inflation and now deserves a break in the unfavorable attention.”
Feeder cattle
Feeder cattle futures were also lower, with the March contract down $1.27 to $167.45 and the April contract down 37 cents to $172.17. The CME Feeder Cattle Index lost 12 cents to close at $162.59.
Corn futures saw modest gains, with the March contract up 9 cents to $6.47 and the May contract up 8 cents to $6.45.
“Calf prices can’t provide the grass to run the cattle in those areas where drought is indicated, but in many areas where producers can ramp up production of more calves, there is likely to be an effort to begin the turnaround in the downward direction of cattle numbers,” the Cattle Report said. “Holding heifers back will accelerate the shortage of replacement cattle for the feedyards.”
Colorado: Winter Livestock in La Junta sold 2,045 head Tuesday. Compared to a week earlier, steers under 450 lbs. sold steady, 450-700 lbs. sold $3-5 higher and over 700 lbs. sold steady to $1 higher. Heifers under 400 lbs. sold mostly steady in a light test, 400-500 lbs. sold $3-5 higher, 500-600 lbs. sold $1-2 higher with instances of $5 higher and over 600 lbs. sold steady. — Anna Miller, WLJ managing editor
