Friday markets
Cattle markets were unable to find any momentum today and plummeted further, just ahead of the holiday weekend.
Live cattle futures lost over a dollar each, with the October contract down $1.25 to $124.80 and the December contract down $1.27 to $130.92.
A small amount of cash trade took place today, with only 1,957 head sold. Live steers sold between $123-126, and dressed steers sold for $203. On the formula side, a total of 31,400 head averaging 863 lbs. averaged $200.64.
“The weakness in the complex is a combination of light trade volume as well as concern that even further weakness will develop in beef prices following the holiday,” remarked Rick Kment, DTN contributing analyst, in his midday comments.
“Cattle and beef prices remain generally disconnected and may stay that way over the next few weeks, but longstanding concerns that the recent rally in beef values will not be able to hold following Labor Day has traders even more nervous of further live cattle pressure during the month of September.”
Slaughter is projected to reach only 114,000 head today due to the upcoming Labor Day weekend. Tomorrow’s slaughter is likely to reach only about 34,000 head, bringing the week’s total to 624,000 head.
Boxed beef prices continue their decline, with the Choice cutout down $1.50 to $336.42 and the Select cutout down 84 cents to $304.13.
“The longer packer margins continue at record levels, for the year, for the month, the clearer folks are getting that a return of leverage will be a fight like never seen,” wrote Cassie Fish, market analyst, in The Beef. “Tighter numbers will help that fight, but packers have become masters at managing both ends of their world cattle supply and end user needs to ensure maximum profit, not maximum throughput.”
Feeder cattle
Feeders also headed south today. The September contract lost $1.82 to $158.47, and the October contract lost $2.57 to $162.47. The CME Feeder Cattle Index lost 20 cents to close at $157.74.
Corn prices were also slightly lower, with the September contract down 8 cents to $5.08 and the December contract down a penny to $5.24.
“The sharp turn lower Thursday has sparked renewed market pressure as traders remain concerned about live cattle support and the recent move lower in beef values,” Kment said.
Nebraska: Valentine Livestock Auction in Valentine sold 3,260 head Thursday. Compared to two weeks ago, steers 850-950 lbs. traded unevenly steady, and heifers 750-850 lbs. sold steady to $6 higher. Benchmark steers averaging 779 lbs. sold between $166.75-170, averaging $168.78. — Anna Miller, WLJ managing editor
