Thursday markets
Cattle futures closed higher on technical buying and news that workers at the Cargill plant in Fort Morgan, CO, have reached a tentative agreement.
Live cattle futures closed higher, with the August contract up $3.32 to $231.22, the October contract $3.47 higher to $227.45 and the December contract up $3.40 to $226.70.
“The live cattle complex is continuing to move higher as traders are committed to advancing the complex following the massive erosion seen during the past month,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments. “The market’s upward momentum is solely technically driven at this point as the cash market has yet to really break loose and trade cattle this week.”
Cash trade was light, with 3,553 head sold. Live steers sold for $232-234, and dressed steers sold for $365-370. On the formula side, 26,100 head averaging 930 lbs. sold for an average of $369.84.
Today’s slaughter is estimated to be 102,000 head, 6,000 head below last week.
Actual slaughter for the week ending July 18 was 523,020 head. The average steer dressed weight was 965 lbs., down 3 lbs. from the prior week.
Boxed beef prices were lower on 130 loads, with the Choice cutout down $2.93 to $360.50 and the Select cutout $1.08 lower to $341.33.
“Boxed beef values are taking their sweet time carving out a seasonal summer low, printing at midday down $0.85 for Choice, $362.58 and Select down $0.54,” Cassie Fish, market analyst, wrote in The Beef. “The Choice/Select spread is $20.71, thanks to a strong wholesale Choice rib market this week.”
CME beef trim contracts remain unchanged. The 50% lean beef trim August contract closed at $175, the September contract at $165 and the October contract at $159.95. The 90% lean beef trim August contract closed at $457, the September contract at $453 and the October contract at $415.
“The news yesterday that Cargill Meat Solutions and the union representing workers at the Fort Morgan, Colorado fed cattle processing facility reached a tentative agreement is positive for the market,” Fish wrote. “The additional capacity returning to the marketplace is well timed given that fed cattle supplies are expected to increase in August and through year’s end. Packer margins have also improved greatly in the last week or so after months of historic losses.”
Feeder cattle
Feeder cattle futures also closed higher, with the August contract up $2.20 to $346.47, the September contract $3.80 higher to $342.45 and the October contract up $4.40 to $334.02.
The CME Feeder Cattle Index was down 56 cents to $347.91.
Corn futures closed lower, with the September and December contracts down 3 cents to $4.45 and $4.68, respectively.
Nebraska: Huss Livestock in Kearney sold 793 head on Wednesday. Compared to the previous auction, steers over 800 lbs. sold $10-15 lower, and there were not enough comparable offerings of heifers to establish a trend. Steers averaging 885 lbs. sold for $344.25-349, averaging $346.33.
Oklahoma: OKC West in El Reno sold 2,405 head on Wednesday. Compared to the previous auction, feeders and calves tested lightly to set a trend, but a lower undertone was noted except for big steers that sold very well in this market. A group of benchmark steers averaging 778 lbs. sold for $340. — Charles Wallace, WLJ contributing editor
