Wednesday markets
The livestock complex closed mixed as traders are expecting weakness in cash trade.
“It’s been several days of big moves in CME live cattle futures, but today’s action is quiet and non-eventful,” Cassie Fish, market analyst, wrote for The Beef. “The market appears to have priced in the weaker wholesale beef prices and sloppy negotiated fed cattle prices for now. Yesterday’s open interest fell over 5k contracts as long liquidation dominated the day and sent futures lower. So today is a classic market rest day as traders regroup.”
Live cattle closed slightly lower, with the February contract down 52 cents to $199.15 and the April contract down 27 cents to $195.27.
Cash trade was moderate, with 3,083 head sold. Live steers sold for $203, and dressed steers sold for $320.
On the formula side, 24,600 head averaging 912 lbs. sold for an average of $331.99.
Today’s slaughter is estimated to be 120,000 head, 1,000 head below a week earlier.
Boxed beef prices were lower on 176 loads, with the Choice cutout down $3.20 to $319.26 and the Select cutout down $3.07 to $309.14.
“Packers, as is well known, have slashed production schedules as they fight massive losses. Monday’s slaughter was revised down 5k head to a very low 95k and the week is expected to be lucky to see a 570k head,” Fish wrote. “Slaughter is expected to stay seasonally small for the coming weeks.”
Feeder cattle
Feeder cattle futures closed slightly higher, with the March contract up 20 cents to $264.97 and the April contract up 27 cents to $265.25.
The CME Feeder Cattle Index was up 9 cents to $275.85.
Corn futures were higher, with the March and May contracts up 6 cents to $4.90 and $5.04, respectively.
Colorado: Winter Livestock in La Junta sold 3,009 head on Tuesday. Compared to the last auction, feeder steers sold mostly $2-7 higher, with instances of sharply higher across all weight classes. Feeder heifers under 700 lbs. sold mostly $3-5 higher and over 700 lbs. sold $5 lower. Benchmark steers averaging 720 lbs. sold for $261-286, averaging $274.11.
Texas: Lonestar Stockyards in Wildorado sold 877mhead on Tuesday. Compared to the last auction, Feeder steers and heifers traded mostly $2-5 lower. Steer and heifer calves were too lightly tested for a market trend. Benchmark steers averaging 714 lbs. sold for $265-267, averaging $266.24. — Charles Wallace, WLJ contributing editor
