Monday markets
The market closed higher today, spurred on by the release of the January cattle inventory report.
Live cattle futures were modestly higher, with the February contract up 87 cents to $139.47 and the April contract up $1.42 to $144.52.
There was some cash trade through Monday, with 855 head sold. On the formula side, a total of 38,500 head averaging 876 lbs. sold for an average of $218.96.
Cash trade through last week totaled 79,765. Live steers averaged $137.02, and dressed steers averaged $218.01, steady with the last several weeks.
“The new week will find cattle owners ready to see if they can advance prices as smaller numbers of cattle are on hand and processing volumes improve,” wrote the Cattle Report.
Cattle slaughter for the day is estimated at 120,000 head, 5,000 head more than a week earlier. Last week’s slaughter is projected at 643,000 head, up several thousand head from the week prior.
“This is the fourth week of subpar volumes and possibly the last as the promise of next week will be more balance in the marketplace between processor and feeder,” the Cattle Report said.
Boxed beef prices were slightly lower on 88 loads, with the Choice cutout down 2 cents to $290.40 and the Select cutout down 14 cents to $283.27.
The January cattle inventory report was released today and showed a reduction in beef cow numbers and the calf crop. All cattle and calves in the U.S. as of Jan. 1 totaled 91.9 million head, down 2 percent from last year. Beef cows were down 2 percent, and beef replacement heifers were down 3 percent. The 2021 calf crop was down 1 percent at 35.1 million head.
Steers weighing 500 lbs. and over were down 1 percent, bulls weighing 500 lbs. or over were down 5 percent and calves under 500 lbs. were down 3 percent. Cattle and calves on feed as of Jan. 1 were up slightly from last year.
“There is a lot of talk about the fact that there are a record number of cattle on feed. Part of this is due to the drought but this drought is nothing as severe as the drought last decade,” wrote Cassie Fish, market analyst, in The Beef.
“Part of the reason there are so many cattle in the yards is that large corporate feeding companies, two owned by hedge funds, leverage occupancy and its contribution to the return on investment in a way that feedyards did not in the past.”
Feeder cattle
“While the market is fully fixated on the upcoming report, it’s only helping boost the market’s morale that corn prices are trending lower as the cost of feeding cattle has gone up significantly,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments.
Feeder cattle shot up on the board today. The March contract gained $3.40 to close at $163.02, and the April contract gained $3.15 to close at $163.02. The CME Feeder Cattle Index lost 22 cents to close at $158.44.
Corn futures saw some losses, with the March contract down 10 cents to $6.26 and the May contract down 8 cents to $6.25.
Missouri: Joplin Regional Stockyards in Carthage sold 8,500 head on Monday. Compared to a week earlier, feeder steers and heifers traded steady. Benchmark steers averaging 773 lbs. sold between $156-161.50.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 11,500 head on Monday. Feeder steers sold unevenly steady, and feeder heifers sold steady to $3 higher. Steer calves sold unevenly steady, and heifer calves sold $2-4 higher. — Anna Miller, WLJ managing editor
