Tuesday markets
Cattle futures closed mostly lower on caution tied to Strait of Hormuz uncertainty and a technical pullback after a rally.
“With the exception of spot April live cattle, CME cattle futures are trading lower today, well into a short-term technical correction after becoming extremely overbought after a huge rally,” Cassie Fish, market analyst, wrote in The Beef. “That rally, culminating with a new spot cattle futures high, has stalled for now, though the dominant bullish market thought process is the Q2 rally is just getting started.”
Live cattle futures closed mixed, with the April contract 17 cents higher to $248.20 and the June contract down $1.22 to $245.80.
Cash trade was light, with only 187 head sold.
On the formula side, 33,300 averaging 953 lbs. sold for an average of $376.65.
The national weekly direct beef type price distribution for the week of March 30 to April 6 was the following on a live basis:
• Negotiated purchases: $245.04.
• Formula net purchases: $239.13.
• Forward contract net purchases: $240.63.
• Negotiated grid net purchases: $243.57.
On a dressed basis:
• Negotiated purchases: $384.44.
• Formula net purchases: $375.62.
• Forward contract net purchases: $374.68.
• Negotiated grid net purchases: $378.94.
Today’s slaughter is estimated to be 113,000 head, 6,000 head above the previous week.
Boxed beef prices were lower on 155 loads, with the Choice cutout down $3.82 to $382.74 and the Select cutout $2.04 lower to $386.33.
“The Choice cutout is discounted to the select and some of the major Choice primals, including the rib, are trading at a discount to their select counterparts,” Fish wrote.
Feeder cattle
Feeder cattle futures lost over $3, with the April contract down $3.12 to $368.90 and the May contract $3.72 lower to $366.62.
The CME Feeder Cattle Index was down $2.26 to $364.55.
Corn futures were lower, with the May and July contracts down 5 cents to $4.49 and $4.60, respectively.
No auction markets in the West reported any sales aside from those reported yesterday. — Charles Wallace, WLJ contributing editor
