Tuesday markets
It was a turnaround Taco Tuesday as cattle futures regained some of yesterday’s losses.
“The bearish news of reopening the Mexican border to feeder cattle imports is behind this market and a formidable rally has begun,” Cassie Fish, market analyst, wrote in The Beef. “No more bearish news is lurking for now. Futures were extremely oversold following a multi-week crushing sell off, and today’s powerful rally appears to be the beginning of a real market recovery.”
Live cattle futures closed higher, with the August contract up $2.25 to $227.47 and the October contract $3.40 higher to $222.17.
Cash trade was light, with 317 head sold. On the formula side, 23,700 head averaging 943 lbs. sold for an average of $380.57.
“Bids are on the table in Kansas at $228 live and in Nebraska at $228 live and $360 dressed,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments. “Following Monday’s light trade, no more sales have been confirmed and asking prices remain elusive. But with the back-and-forth nature of the board this week, it is anyone’s guess when trade will fully get underway and what the week’s weighted average trend will be.”
The national weekly direct beef type price distribution for the week of July 20-27 was the following on a live basis:
• Negotiated purchases: $230.61.
• Formula net purchases: $247.20.
• Forward contract net purchases: $240.94.
• Negotiated grid net purchases: $255.66.
On a dressed basis:
• Negotiated purchases: $365.57.
• Formula net purchases: $388.27.
• Forward contract net purchases: $380.17.
• Negotiated grid net purchases: $401.12.
Today’s slaughter is estimated to be 106,000 head, 3,000 head above the previous week.
Boxed beef prices were mixed on 112 loads, with the Choice cutout up $2.97 to $365.86 and the Select cutout down $1.64 to $343.52.
CME beef trim contracts remain unchanged. The 50% lean beef trim August contract closed at $175 and the September contract at $165. The 90% lean beef trim August contract closed at $457 and the September contract at $453.
Feeder cattle
Nearby feeder cattle futures closed higher, with the August contract up $4.82 to $343.07 and the September contract $5.30 higher to $337.22. Deferred contracts from November on closed lower.
The CME Feeder Cattle Index was $2.28 lower to $347.37.
Corn futures closed higher as USDA’s Crop Progress report showed that 63% of the crop was in good-to-excellent condition, 4 percentage points below the previous week. The September and December contracts were up 6 cents to $4.58 and $4.80, respectively.
New Mexico: Roswell Livestock in Roswell sold 577 head on Monday. Compared to the last auction, steer calves sold lower, and feeder steers were uneven, but a lower trend was evident. Heifer calves 400-550 lbs. sold lower and 550-600 lbs. were $5 higher. Feeder heifers sold sharply lower. A group of benchmark steers averaging 705 lbs. sold for $360. — Charles Wallace, WLJ contributing editor
