Tuesday markets
Cattle futures closed mostly higher to finish another record year for cattle prices.
“So what fundamental factor deserves the credit for record high 2024 prices? It is demand,” Cassie Fish, market analyst, wrote for The Beef. “Beef demand has been remarkable. Despite 2024 record high retail prices of just over $8 per pound, consumers have doggedly purchased beef with unwavering regularity. Over the spring and summer, the ground beef complex took center stage, but since the lean beef market topped over the summer, the rib has stepped in and traded at record high levels in Q4, well above the 2020 COVID highs. The chuck even had a historic run in October. The combination of all of these strong items resulted in this historic achievement.”
Live cattle futures were mixed, with the December contract down 22 cents to $193.85 and the February contract up $1.30 to $191.60.
According to Barchart, December futures traded between $173.15-194.50 during the 2024 trading year.
Cash trade was light, with 1,006 head sold for $197.
On the formula side, 30,400 head averaging 915 lbs. sold for an average of $309.02.
The national weekly direct beef type price distribution for the week of Dec. 23-30 was the following on a live basis:
• Negotiated purchases: $194.74.
• Formula net purchases: $196.08.
• Forward contract net purchases: $189.76.
• Negotiated grid net purchases: $197.66.
On a dressed basis:
• Negotiated purchases: $307.26.
• Formula net purchases: $310.34.
• Forward contract net purchases: $301.92.
• Negotiated grid net purchases: $306.14.
Today’s slaughter is estimated to be 102,000 head.
Boxed beef prices were lower, with the Choice cutout down $1.15 to $324.22 and the Select cutout down 24 cents to $294.52.
Feeder cattle
Feeder cattle futures were higher, with the January contract up $1.40 to $263.02 and the March contract up $1.92 to $262.97. Barchart showed that the 52-week trading range for January feeder cattle was $228.80-272.42.
The CME Feeder Cattle Index was up $7.08 to $261.05, up 14.4% for the year, according to the Financial Times.
“Feedyards will begin 2025 with ample cattle-on-feed (COF) at record weights, the sixth highest COF inventory since 1996,” Fish wrote. “Many states have more COF than a year ago, including Colorado, Nebraska, Iowa, South Dakota and Minnesota. There is an assumption that COF inventories will decline in 2025, just as there was in 2024. Will the industry hit the end of the chain pushing carcass weights ever higher? Will beef demand maintain? Will retailers raise prices even more to recoup losses and more importantly, will consumers continue to pay up? These are key questions to contemplate as the cattle bull market heads into its fifth year.”
Corn futures were higher, with the March contract up 6 cents to $4.58 and the May contract up a nickel to $4.65.
Nebraska: Tri-State Livestock in McCook sold 1,776 head on Monday. There was no accurate comparison due to the lack of a recent auction. Benchmark steers averaging 778 lbs. sold for $272.50-273.25, averaging $272.71. — Charles Wallace, WLJ contributing editor
