Tuesday markets
A correction in corn and soybean futures fueled feeder cattle prices higher.
Live cattle ended the day mixed, with the February contract up 15 cents to $141.97 and the April contract down 22 cents to $146.17.
Cash trade was light, with 4,163 head selling between $139-141, averaging $139.90. Dressed steers sold for $222. On the formula side, 30,800 head averaging 881 lbs. sold for $223.25.
“The big kicker of this week will be throughput and cash cattle trade,” ShayLe Stewart, DTN livestock analyst, wrote in the midday comments. “The more aggressive throughput is the better chance feedlots stand at pushing the cash cattle market higher in the weeks to come. The cash cattle market hasn’t seen any interest and it’s not likely trade develops until Wednesday or later.”
Slaughter for the day is projected to be 122,000 head, a thousand above last week.
“The beginning of the necessary changes that will restore balance to the supply/demand of cattle and beef will play out in the weeks, months and years ahead of us,” The Cattle Report wrote. “The first step will be a restoration of more normalized slaughter volumes and this week’s 639,000 head failed that benchmark. February is not a strong month for beef demand. This will set the stage for a waning demand for beef while cattle owners hope to continue advances in live cattle pricing.”
Boxed beef prices were lower on 180 loads, with the Choice cutout down $1.50 to $277.46 and the Select cutout down $1.20 to $273.84. The Choice/Select spread was $3.62.
The Daily Livestock Report wrote that the Choice cutout was down $14.50/cwt or 5 percent from Jan. 24. While all primals have lost ground during the last two weeks, the most significant decline has come in the loin primal value. During this period, the loin primal was down 7 percent and accounted for about 40 percent of the overall decline in the cutout value.
Feeder cattle
Feeder cattle were higher on lower grain prices, with the March contract up $1.85 to $166.87 and the April contract up $1.50 to $171.77. The CME Feeder Cattle Index was up $1.29 to $161.43.
Corn was trading sharply lower but made up some ground, with March and May contracts closing down 3 cents to $6.32 and $6.34, respectively.
“The feeder cattle contracts are posting a strong rally, and if cash cattle can manage to trade cattle steady to somewhat higher this week, the market really stands a chance at keeping its steam,” Stewart said. “Receipts are expected to be light throughout sale barns as producers have largely already marketed their calves and feeders, and most of the country is thinking about getting cows ready for calving.”
Iowa: Russell Livestock in Russell sold 3,481 head Monday. Compared to the last auction, steer calves under 750 lbs. were mostly steady to $4 higher; 750-850 lbs. sold $7-9 higher. Heifer calves under 650 lbs. sold $2 higher and heifers over 650 lbs. were $2-5 higher. Benchmark steers averaging 762 lbs. sold between $160-173.60, averaging $169.07.
Nebraska: Tri-State Livestock in McCook sold 1,818 head Monday. Compared to the previous auction, steers were steady to $12 higher, except 900 lb. steers were $5 lower. Heifers sold $4-7 higher. Benchmark steers averaging 715 lbs. sold between $163.50-173.50 and averaged $170.29.
South Dakota:Sioux Falls Regional in Worthing sold 5,074 head Monday. Compared to the last auction, feeder steers sold steady to $4 higher, except 350-400 lbs., 450-550 lbs., and 650-700 lbs. were $4-9 higher. Feeder heifers sold steady to $4 lower, except 400-450lbs., and 550-600 lbs. were $8-10 higher, 650-700 lbs., and 800-850 lbs. traded $2-4 higher. Benchmark steers averaging 728 lbs. sold between $163.50-176.50 and averaged $169.71. —Charles Wallace,WLJ editor
