Tuesday markets
Commodity markets closed mixed following USDA’s release of the World Agricultural Supply and Demand Estimates (WASDE) report.
The WASDE report showed corn yields and production were revised upward, while feeder cattle prices were lowered for 2021. The estimated yield for corn is 176.5 bushels per acre, and production is 15.01 billion bushels. “Fed cattle prices for 2021 are lowered on current price movements and relatively large supplies of fed cattle,” the WASDE report stated. “However, the 2022 price forecast is raised on tighter expected supplies of cattle.” USDA raised beef production estimates despite lower slaughter numbers due to heavier average carcass weights. “Beef production in the October report posted a 90-million-pound increase for 2021 and a 120-million-pound increase for 2022 compared to the September report,” wrote Rick Kment, DTN contributing analyst, in the midday comments.
Live cattle contracts closed the day lower, with the October contract down 60 cents to $125.02 and the December contract lower 92 cents to $129.25.
Cash trade was light today, with 495 head selling for $122. Cash trade was at a standstill in Kansas and Nebraska. In the Texas Panhandle and western Corn Belt, negotiated cash trading has been mostly inactive with very light demand. Dressed steer trade was nonexistent today.
“It will be interesting following last week’s higher trade levels, if the bulk of trade will once again develop at midweek as has been the pattern over the last month, or if feeders will hold out for possible higher trade at the end of the week,” Kment wrote.
On the formula side, 29,800 head averaging 873 lbs. sold for $201.27.
The national weekly direct beef type price distribution for the week of Oct. 4 to Oct. 11 was the following on a live basis:
• Negotiated purchases: $123.17.
• Formula net purchases: $126.
• Forward contract net purchases: $130.
• Negotiated grid net purchases: $126.51.
On a dressed basis:
• Negotiated purchases: $195.27.
• Formula net purchases: $200.60.
• Forward contract net purchases: $197.95.
• Negotiated grid net purchases: $200.90.
Slaughter for the day is projected to be 120,000 head, 2,000 below last week.
Boxed beef prices were lower on 177 loads, with the Choice cutout down 5 cents to $281.07 and the Select cutout down $2.29 to $261.35.
The WASDE report showed imports forecasts for 2021 and 2022 were raised due to higher demand, but exports remain unchanged.
Feeder cattle
Feeder cattle futures closed the day mixed following the WASDE report showing increased production in 2022. The October contract was down 75 cents to $158.57, and the November contract was higher 7 cents to $161.80. Contracts in 2022 were higher 25-77 cents. The CME Feeder Cattle Index was lower 42 cents to $154.15.
Corn futures were lower today by 10 cents, with the December and March contracts closing at $5.22 and $5.32 a bushel, respectively.
New Mexico: Roswell Livestock in Roswell sold 1,907 head on Monday. Compared to last week, steer and heifer calves under 600 lbs. sold $8-10 higher, and calves and feeders over 600 lbs. were steady to $2 higher. A group of steers averaging 678 lbs. sold between $144.50-148 and averaged $146.51.
Nebraska: Tri-State Livestock in McCook sold 2,888 head on Monday. Compared to the previous auction, on compared classes, steers were steady to $6 higher, and heifers were steady to $4 lower. A group of steers averaging 621 lbs. sold between $161.50-170, averaging $165.05. — Charles Wallace, WLJ editor
