Wednesday markets
Cash fed cattle trade got underway today with 27,387 head trading at $101 live and $160-161 dressed. CME fed cattle futures were all red today with October live cattle down $1.07 to $104.70 and December down 97 cents to $109.15.
There has been no trade in Southern Plains feedlots. A total of 27,100 head of formula grid cattle were priced today at $173.32 weighing 900 lbs. Packers haven’t been very aggressive this week as they have plenty of inventory around them.
Beef markets have been drifting lower since the Labor Day rally; Choice was trading at $231 prior to Labor Day and traded today at $222.95, and Select was down to $207.51 on 186 loads. Packers have picked up slaughter, processing 241,000 head so far this week, which is a short week. Last week, 636,000 head were processed, which was 21,000 head lower that the week before.
Beef demand typically is lower the weeks following Labor Day, then picks up in October.
Carcass weights were 885 lbs. on fed cattle, which is 27 lbs. over last year. Dressing percentages remain high at 64-65 percent. Between carcass weights and dressing percentages it demonstrates that there are plenty of over-finished cattle to be processed.
Cassie Fish, market analyst in The Beef remarked today, “Cash bids of $100 surfaced south but there is a reluctance among cattle feeders to hit that bid. This week’s developments are sobering for those optimistic cash cattle prices could disconnect from seasonally lower boxed beef prices which are likely to persist until early October.
“It’s clear that while some feedyards may have gotten cleaned up of cattle that needed to go, others have not. Some packing plants are full until October. The cash trade has become a difficult slog for cash market sellers.”
Feeder cattle futures took a beating after yesterday’s positive movement. September feeders were down 55 cents to $138.40 and October was down $1.60 to $138.25. The CME Feeder Cattle Index was $140.91.
OKC West in El Reno, OK, sold 4,669 head of feeder cattle today and reported compared to last week: Feeder steers and heifers traded steady to mostly $2 higher. Demand was good for all classes of feeder cattle, especially heavier weights.
No trend available for steer and heifer calves, however a lower undertone was noted with the exception of a few trades that were long weaned with multiple rounds of shots trading steady. Demand was moderate. Unseasonably cooler temperatures along with multiple days of rain are in the forecast over the trade area. Benchmark feeder steers weighing 785 lbs. averaged $136.67. — Pete Crow, WLJ publisher
