Friday markets
Despite lower corn futures, feeder cattle closed mixed. A ho-hum day for cash trade and a steady week led to lower live cattle futures.
Live cattle closed lower, with the June contract down $1.02 to $132.75 and the August contract down 67 cents to $135.35. Live cattle futures closed the week lower, with the June contract down $2.45 and the August contract down $1.70.
“It’s an uneventful day again for the live cattle sector as the market’s contracts drift lower and the cash market sits without any bids renewed,” ShayLe Stewart, DTN livestock analyst, wrote in the midday comments.
Cash trade was light, with 3,762 head selling between $141-146, averaging $145.30. Dressed steers sold for $232. On the formula side, 34,700 head averaging 900 lbs. sold for $231.34.
Sales in the North were mostly at steady prices, with $145-147 for live cattle and $232 for dressed. Cattle in the South traded at $140 in Texas and $140-141 in Kansas.
“Likely cattle feeders are taking advantage of getting cattle sold at the highest price level of 2022, which happens to be the highest since 2015—before the seasonal sell-off into summer gets underway. Prices this week have traded mostly steady with last week, averaging somewhere near $143 and change,” Cassie Fish, market analyst for The Beef, wrote.
Slaughter for the day is projected to be 121,000 head. With tomorrow’s slaughter projected at 49,000 head, the week’s total will likely be about 657,000 head.
According to the USDA’s Agricultural Marketing Service, total red meat production under federal inspection for the week ending May 7 was estimated at 1,078.8 million lbs. This was 1.3 percent higher than a week ago and 3.2 percent higher than a year ago.
Boxed beef prices closed lower on 80 loads, with the Choice cutout down 74 cents to $254.44 and the Select cutout down 75 cents to $245.06.
“Boxed beef values are surprisingly weak, with too much unsold product forcing values lower,” Fish wrote. “The rib primal has fallen back to the low for 2022, a sign of a demand pushback. … The beef market’s weakness in early May, a typically very strong seasonal price month, if not the strongest, was not anticipated by the packing industry when forecasting margins for this month. Packer margins are now their tightest of 2022 but almost all of 2021.”
Feeder cattle
Feeder cattle closed mixed, with the May contract down 77 cents to $159.55 and the August contract up 32 cents to $174.70. Feeder cattle finished the week mixed, with May down $1.87 and August up 63 cents. The CME Feeder Cattle Index was up a penny to $155.60.
“Traders are finding it easiest to put most of their support and trust in the market’s deferred contracts as they know by late 2022 and early 2023, numbers will likely favor sellers and the market will have a clearer understanding of what the 2022 grain situation is,” Stewart wrote.
Corn closed lower with the forecast of hot temperatures in the Corn Belt. The May contract was down 11 cents to $7.92, and the July contract was down 12 cents to $7.84.
Kansas: Pratt Livestock in Pratt sold 2,179 head Thursday. Compared to the last auction, feeder steers 900-1,025 lbs. sold $3-5 higher. There were not enough 650-900 lb. feeder steers or heifers for a market test, but a lower trend was noted. Benchmark steers averaging 772 lbs. sold between $151-154.50 and averaged $154.26.
Montana: Billings Livestock in Billings sold 948 head on Thursday. Compared to the last auction, feeder steers and heifers were too lightly tested this week to develop an accurate market trend, but higher undertones were noted. Benchmark steers averaging 739 lbs. sold between $170-171.
Texas: Cattlemen’s Livestock in Dalhart sold 2,150 head on Thursday. Compared to the previous auction, feeder steers were not well tested in all weight classes, although a lower undertone was noted, with instances of $10-12 lower. Feeder heifers were unevenly steady. Benchmark steers averaging 738 lbs. sold between $140-146, averaging $144.32. — Charles Wallace, WLJ editor
