Wednesday markets
Cattle futures closed mostly lower as a soft cash trade is developing this week.
Live cattle futures closed triple digits lower, with the August contract down $1.30 to $230.12 and the October contract $1.65 lower to $226.
“CME cattle futures continue the dramatic break, now in its fourth week, with most active October as well as the December contract both checking their respective June 4 low,” Cassie Fish, market analyst, wrote in The Beef. “The deferred contracts are actually leading the way down, motivated by fear that the six-year bull market is over and a bear market has begun. As ugly as the action is, futures so far have not made a new low for the year and they continue to trade well below the cash market.”
Cash trade was moderate, with 12,944 head sold. Live steers sold for $238-240, and dressed steers sold for $373-380.
On the formula side, 24,700 head averaging 944 lbs. sold for an average of $402.80.
“Some bids are currently on the table in Nebraska at $238-240 live and $375 dressed, but no trade has developed following Tuesday’s thin movement,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments. “On Tuesday, some cattle traded in Nebraska at $380, which is $12 lower than last week’s weighted average, but some cattle were also sold in Iowa at $385, which is $6 lower than the previous week’s weighted average. At this point, it’s anyone’s guess where the cash market trend will land this week.”
Today’s slaughter is estimated to be 108,000 head, the same as last week.
Boxed beef prices were lower on 123 loads, with the Choice cutout down $2.67 to $371.28 and the Select cutout $5.23 lower to $359.18.
“Boxed beef prices are also correcting this week, but their break is taking a back seat to futures and cash fed cattle,” Fish wrote. “At midday today, choice printed at $373.46/cwt, down $0.46. So far, the seasonal decline in boxed beef prices is 6.75%. Seasonal sloppiness typically continues another 10 days to 2 weeks.”
Feeder cattle
Feeder cattle futures closed mixed, with the August contract up $1.15 to $349.95 and the September contract down 47 cents to $344.37.
The CME Feeder Cattle Index was down $2.20 to $370.32.
Corn futures closed higher, with the September and December contracts up 9 cents to $4.47 and $4.69, respectively.
Texas: Lonestar Stockyards in Wildorado sold 658 head on Tuesday. There were not enough comparable sales of steers or heifers to establish a market trend, but a lower undertone was noted. However, quality was a little plainer than a week ago, which accounted for some of the decline noted in prices. A group of benchmark steers averaging 756 lbs. sold for $360. — Charles Wallace, WLJ contributing editor
