Wednesday markets
“It’s a strong day for the livestock contracts as the markets are rallying in an aggressive manner. The only market trading mixed is the feeder cattle contracts; with corn prices shooting higher it makes sense that the market is teetering in its position,” remarked ShayLe Stewart, DTN livestock analyst, in her midday comments.
Live cattle futures posted higher today. The February contract gained 87 cents to close at $138.55, and the April contract gained $1.50 to close at $143.35.
There was some cash trade today, with 10,076 head sold. Live steers sold between $136-137, and dressed steers sold between $217-218. On the formula side, a total of 11,200 head averaging 901 lbs. sold for $218.71.
“Because fed cattle supplies are much larger than in those historically tight supply years of 2014 and 2015 and plant hourly and daily throughput is less now than it was pre-April 2020 when the pandemic struck the industry with full force, packers do not have to compete aggressively to fill their slaughter schedules,” said Cassie Fish, market analyst, in The Beef.
“So cattle prices—though they have risen steadily after bottoming the summer of 2020 at $95 to the top price reached in early December 2021 of $140—remain limited to what is achievable, even in an up market.”
Slaughter for the day is estimated at 115,000 head, a thousand head more than the same time a week earlier. Slaughter to date so far this week is 345,000 head, a few thousand head higher than the same time a week ago but about 6,000 head short of the same time last year.
“Yesterday’s daily federally inspected cattle slaughter reached 117k head, the largest thus far in January and a clear improvement,” Fish said. “Expectations are that daily slaughter levels will push back to 120k to 122k on a regular basis and the temporary slowdown of throughput will be behind the industry.”
Boxed beef prices were higher on 115 loads. The Choice cutout gained $2.11 to close at $291.60, and the Select cutout gained $2.04 to close at $280.43.
Feeder cattle
Feeder cattle futures were mixed today. The January contract lost 5 cents to close at $161.40, and the March contract gained 20 cents to close at $165.62. The CME Feeder Cattle Index lost 6 cents to close at $161.24.
Corn futures posted higher, with the March and May contracts up 11 cents each, closing at $6.10 and $6.11, respectively.
“It wouldn’t be surprising to see order buyers take a removed position in sales this week as they look to see what further develops in the market before jumping into more cattle,” Stewart said.
Colorado: Winter Livestock in La Junta sold 5,165 head on Tuesday. Compared to the last sale, steers under 550 lbs. sold mostly steady, 550-700 lbs. sold $2-3 higher and over 700 lbs. sold steady to $1 lower. Heifers under 600 lbs. sold $2-3 lower, 600-700 lbs. sold steady to $2 lower and over 700 lbs. sold steady to $3 lower, with the decline on 750-800 lbs. — Anna Miller, WLJ managing editor
