Friday markets
The week closed with a much stronger cash cattle market. Trade in the Southern Plains has been active on moderate demand. Compared to last week, live purchases moved $2 higher at $109 in the Texas Panhandle, and $1 higher at $109 in Nebraska. Dressed purchases have moved steady at $170. Trade in the western Corn Belt has been slow on light demand, but $2 higher than yesterday’s market at $107-110.
A total of 65,079 head traded compared to last week’s 9,629 head and last year’s 14,754 head. On the formula grid, 13,500 head weighing 880 lbs. traded at $171.93.
Live cattle futures closed mixed: The October contract was up 17 cents to $109.87, but the December contract lost 2 cents to $112.60 and the November contract was down 70 cents to $114.30.
“Traders will be closely watching the quality grade that has been declining and the carcass weights that have risen the past two weeks, but should level or decline moving forward,” reported the Cattle Report.
“Improving leverage for bargaining on price should give cattle owners a rightful share of the margins available as cattle move through the beef pipeline.”
The Report noted beef processors are currently experiencing extremely large margins, “leaving adequate room for sharing with the beef producers.”
Boxed beef prices finally experienced a seasonal drop in value. On 124 loads, the Choice cutout was down $1.94 to $214.06 and the Select cutout down $3.28 to $199.82.
Today’s slaughter is estimated at 112,000 head, a few thousand head below last week and last year. Tomorrow’s slaughter is projected at 53,000 head, down more than 15,000 head from last weekend.
Feeder cattle
Compared to last week, steer and heifer calves sold $1-3 lower, while yearling steers and heifers sold steady to $1 lower. The supply of feeders was moderate and demand was moderate to good, with the best demand on yearlings able to fit the April CME contract.
The CME cattle complex has been under pressure all week with the feeder cattle contracts being mostly $3-4 lower on the week.
The October feeder cattle contract settled 20 cents higher at $138.25, and the November and January contracts lost 92 and 97 cents respectively, to settle at $135.52 and $134. The latest known CME Feeder Cattle Index was down 68 cents to $141.92.
Centennial Livestock Auction in Fort Collins, CO, sold 2,061 head yesterday. Trade activity and demand was good on yearling steers and heifers, moderate on calves. No trend available due to a lack of comparable trades.
Drought across the country leads ranchers to take into consideration how much forage stocks are available and if it is worth it to keep open or short-bred cows around to the next season.
The National Feeder and Stocker Cattle Summary report posed the question: How many cows will leave the farm and go to harvest with a rancher exposed to paying more to keep cows around this winter than he has in the past?… — Anna Miller, WLJ editor
