Wednesday markets
As slaughter capacity picks up, boxed beef prices continue to drop rapidly day by day. Cash fed cattle prices have also dropped, ranging from $110-117, likely as a result of the expectation for the cutout decline to continue.
“As multiple aspects of the market continue to normalize it makes sense that the basis would take a turn,” said Cassie Fish in The Beef. “The real unknown is once packer margins, basis, production levels and wholesale prices have returned to some semblance of normal, where does the market go from there?”
Fish estimates the backlog of cattle is likely to continue cash price pressure for many more months and it “will be a long time before the market is beyond its woes and there is true clarity of what price it will take to clear what’s coming.”
Numbers were up across the boards today for both live and feeder cattle. June live cattle saw a slight increase of 2 cents to $95.45, August up $1.15 to 97.35, and October ended half a dollar higher at $99.97.
August feeder cattle were up 80 cents to $134.22, September increased 87 cents to $135.77, and October gained 90 cents to close at $136.57. The latest known CME Feeder Cattle Index was down slightly at $128.25.
The 5-area weekly accumulated slaughter logged 7,781 live steers and 4,835 live heifers, each selling for an average of $115.79. A total of 11,929 dressed steers sold for $180.52 and 4,084 dressed heifers sold slightly higher at $181.48.
USDA reported trade and demand moderate in all feeding regions. The Texas Panhandle reported live prices steady at $117. Kansas traded live purchases steady to $7 lower, mostly $110-117. Nebraska traded $1-9 lower, mostly $109-117 and the bulk at $117.
The western Corn Belt traded live purchases mostly at $113-114.
Dressed purchases traded unevenly steady, mostly $175-185.
Today’s slaughter was at 114,000 head, up slightly from last week’s 110,000, but still below last year’s 120,000.
Boxed beef prices continue to drop, with a load of 141 reporting Choice down $22.83 to $295.90 and Select down $13.80 to $276.78.
“Processors will be watching box prices fall as slaughter volumes increase and will stop supporting the fed market,” a report by the Cattle Report read. “Feedlots will adjust prices to stocker and feeder cattle and ultimately the damage falls on the backs of the breeders who have watched increases in all of their input cost and now must face the potential for unsupportable calf prices.” — Anna Miller, WLJ editor
