Tuesday markets
Cash cattle trade was slow again today with only 248 head trading hands, compared to 640 head a week ago.
“Cash prices are converging with the October futures and many hedged cattle owners will find some relief from negative basis prices that have been in place for many weeks and the last two expired live cattle contracts,” reported the Cattle Report. “The implications for the cash prices will be to tether cash to futures for the balance of this month.”
CME live cattle futures are higher, with the October contract up 38 cents to $109.20, December up 20 cents to $111.95 and February up 13 cents to $115.35.
“Beef demand increased uncharacteristically and significantly in September,” said Cassie Fish, market analyst, in The Beef. “Boxes have bottomed and will head higher into early December and packers’ sales volume has been phenomenal, both out-front and spot.”
Boxed beef was down slightly, with the Choice cutout down 74 cents to $216.24 and the Select cutout down $1.17 to $206.84 on 168 loads.
“Today’s Choice cutout at $216 is the second highest price for this week in October since 2014, Fish said. “Packer margins are record. This why last week’s slaughter was 665k and this week is estimated at 655k to 660k.”
The day’s slaughter is estimated at 120,000 head, on trend with last week.
“Some feedyards need pen space, but fundamentally the cattle feeding industry finally has some leverage, thanks to increased throughput as packers process cattle to fill orders and realize sales revenue,” Fish said.
Feeder cattle futures took a hit, with the October contract down $1.93 to $138.13, November down $2.40 to $137.53, and January down $1.98 to $136.15. The latest known CME Feeder Cattle Index was up 36 cents to $143.10.
“Concerns about feed availability and feed costs continue to worry feedlots especially as drought continues to spread across the country,” said ShayLe Stewart, livestock analyst at DTN. “Sales are starting to see more calves trotting across their scales as producers are beginning to wean their spring-born calves.”
Oklahoma National Stockyards in Oklahoma City, OK, sold 5,527 head yesterday. Compared to last week, feeder steers sold unevenly steady; feeder heifers sold $1-4 higher; steer calves sold steady to $3 lower, with most declines over 500 lbs.; and heifer calves sold mostly $2-5 higher. Demand was moderate to good and quality was mostly average.
Joplin Regional Stockyards in Carthage, MO, sold 5,082 head yesterday. Compared to last week, steer calves sold steady to $4 higher and yearlings sold unevenly steady. Heifers sold weak to $5 lower with a few lightweight heifers trading as much as $9 lower. Supply and demand were moderate. — Anna Miller, WLJ editor
