Thursday markets
Despite a rosy export report, cattle futures closed in the red. Grain futures continue their climb amid the Ukrainian war, putting pressure on feeder cattle.
“The live cattle contracts are running lower, the cash cattle market isn’t seeing much action and with tensions in Ukraine only worsening, the market will likely continue to panic in this way until something gives with Russia/Ukraine,” ShayLe Stewart, DTN livestock analyst, wrote in the midday comments.
Live cattle closed sharply lower, with the April contract down $1.75 to $138.35 and the June contract down $1.55 to $135.15.
Cash trade was light, with 8,797 head selling between $140-143, averaging $141.28. Dressed steers sold between $223-225 and averaged $224.04. In Nebraska, a few live and dressed purchases traded at $140 and $224, respectively.
On the formula side, 23,900 head averaging 857 lbs. sold for $228.36.
The Special Fed Cattle Exchange Auction held Thursday listed a total of 1,732 head, of which none sold—125 were scratched from the auction and 1,607 head were listed as unsold, as they did not meet the reserve prices, which ranged from $139-143.
Slaughter for the day is expected to be 124,000 head, the same as last week.
Actual slaughter for the week ending Feb. 19 was 670,195 head. Steer carcass weights were 921 lbs., up 3 lbs. from the previous week.
Boxed beef prices were lower on 155 loads, with the Choice cutout down $1.37 to $254.35 and the Select cutout down $3.55 to $247.79.
USDA’s Weekly Export report for the Feb. 18 to Feb. 24 period showed net sales of 23,800 metric tons (mt), up 64 percent from the previous week and 23 percent from the prior four-week average. Exports of 17,600 mt were up 15 percent from the previous week and 11 percent from the prior four-week average. The destinations were primarily South Korea (5,200 mt), Japan (4,500 mt), China (2,700 mt), Mexico (1,400 mt) and Taiwan (1,200 mt).
Feeder cattle
“There’s one thing we need to get clear about the markets right now: These prices reflect war and fear and are not a reflection of the fundamentals of the feeder cattle market,” Stewart said. “As corn prices shoot to new highs, the feeder cattle complex is left with no other option but to shoot lower. As if the war in Ukraine isn’t enough, we can’t overlook the drought conditions here in the U.S. Being a bull in the feeder cattle market’s short term is a nearly impossible job.”
Feeder cattle were down triple digits, with the March contract down $1.95 to $156.35 and the April contract down $2.47 to $160.52. The CME Feeder Cattle Index was down $1.47 to $157.78.
Corn was trading as much as 35 cents a bushel higher during the trading but settled down a bit. The March contract closed up 12 cents to $7.51, and the May contract was up 22 cents to $7.47.
Kansas: Winter Livestock in Dodge City sold 6,247 head Wednesday. Compared to the previous auction, feeder steers 550-1,000 lbs. sold steady to $5 lower. Steer calves 400-550 lbs. sold $4-6 higher. Feeder heifers 650-900 lbs. sold $5-8 lower. Heifers 550-650 lbs. sold $7-10 lower. Heifer calves 400-550 lbs. sold $3-4 higher. Benchmark steers averaging 781 lbs. sold between $148.50-157.50, averaging $153.70.
New Mexico: Clovis Livestock in Clovis sold 1,683 head Wednesday. Compared to the last auction, feeder steers and heifers sold $2-5 lower. Benchmark steers averaging 770 lbs. sold between $149.50-154.50 and averaged $153.66.
Oklahoma: OKC West in El Reno sold 9,714 head Wednesday. Compared to the last auction, feeder steers traded $2-6 lower. Feeder heifers sold $3-7 lower. Steer and heifer calves sold steady to $1 higher. Benchmark steers averaging 719 lbs. sold between $154.50-164, averaging $157.22.
South Dakota: Hub City Livestock in Aberdeen sold 8,556 head Wednesday. Compared to the previous auction, steers under 650 lbs. were not well compared, and 650-900 lb. steers sold $5-10 lower, with lower undertones noted on steers over 900 lbs. The best test on heifers 600-700 lbs. traded $8-12 lower, while 701-850 lbs. sold $2-4 lower. Benchmark steers averaging 777 lbs. sold between $153-167.75, averaging $164.78.
Wyoming: Torrington Livestock in Torrington sold 4,375 head Wednesday. Compared to the previous auction, steer and heifer calves traded $3-6 lower. All of the offerings consisted of long-time weaned calves, with most of the trade being smaller package trade. Benchmark steers averaging 736 lbs. sold between $164-170.50 and averaged $169.08. — Charles Wallace, WLJ editor
