Monday markets
Cattle futures rallied to start the week after a rocky start at the beginning of the trading day.
Live cattle were higher, with the August contract up $2.20 to $136.15 and the October contract up $1.47 to $140.42.
Cash trade was very light, with 538 head sold—not enough for a market trend. On the formula side, 57,700 head averaging 860 lbs. sold for $226.49.
Cash trade was light through the holiday-shortened week, totaling 71,515 head. Of that, 68 percent (48,490 head) were committed to nearby delivery, while the remaining 32 percent (23,025 head) were committed to deferred delivery. Live steers averaged $144.15, and dressed steers averaged $232.61.
“Since the largest negotiated fed cattle trade occurs in Nebraska each week and the premium in the North is record wide, that means the 5-area average price posted last week at $144.35,” wrote Cassie Fish, market analyst for The Beef. “That was $1.71 lower the prior week, which was the 2022 high. The South limped along at $137 to $138. And for the second week in a row, trade volume was light as packers resisted buying big volume, happy to instead draw on captive supply to fill needs.”
Slaughter is projected to be 125,000 head, 6,000 head above this period last year.
Boxed beef prices were higher on 113 loads, with the Choice cutout up 25 cents to $268.14 and the Select cutout up $1.15 to $243.
“It’s supportive that boxed beef prices are higher and that, even with last week being a shortened holiday week, slaughter speeds still ran aggressively, and that beef demand was strong,” ShayLe Stewart, DTN livestock analyst, wrote in the midday comments. “The weak links in this week’s market will likely be that the board is still trading discount to cash, which limits its upside potential, and temperatures are on the rise. With the forecast expected to be hotter, feedlots may deem it smarter to sell cattle and avoid carrying them longer in this heat.”
According to the Daily Livestock Report, USDA’s Economic Research Service released the May export report, showing beef exports were 2.1 percent higher than last year at 6.7 million lbs., the highest monthly export level for 2022. Japan and South Korea were the top two destinations in May. Shipments to Japan were 75.9 million lbs., down 5.6 percent from a year ago, and shipments to South Korea were 74.9 million lbs., down 7.1 percent from a year ago.
Beef imports continue to track above 2021 levels, with May posting an 8.8 percent increase (up 23.8 million lbs. over last year) to 294.2 million lbs. Canada was the top supplier in May, with shipments of 79.8 million lbs., down 3.2 percent from 2021. Brazil’s exports continue to track above the prior year, with May up 15.4 percent to 64.4 million lbs.
Feeder cattle
Feeder cattle closed triple digits higher, with the August contract up $3.15 to $174.87 and the September contract up $2.67 to $177.40.
“The market sits in a peculiar position right now as it seems to be torn by two different realities,” Stewart wrote. “The first is of the bearish nearby concern of drought, high inputs, and a rallying corn market. But one simply cannot deny the long-term bullish trajectory that the market possesses as it faces a significant decrease in beef-cow numbers which will drive the price of both feeders and calves higher.
“Nevertheless, this week will be significant for the market as Superior hosts their Week in the Rockies sale where 206,370 head will sell and give the market a great insight as to what prices could be this fall/winter,” Stewart continued.
Corn closed higher, with the July and September contracts each closing 3 cents higher to $7.81 and $6.37, respectively.
Missouri: Joplin Regional Stockyards in Carthage sold 11,000 head Monday. At the mid-session, compared to a week earlier, feeder steers were trading steady to $2 higher, and feeder heifers were trading steady to $4 higher. Benchmark steers averaging 774 lbs. sold between $168-176, averaging $169.59.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 9,500 head on Monday. At the mid-session, compared to a week earlier, feeder steers and heifers sold $3-5 higher. Steer calves were steady to $3 lower. Heifer calves traded $1-4 higher. Benchmark steers averaging 728 lbs. sold between $170-182 and averaged $174.76. — Charles Wallace, WLJ editor
