Wednesday markets
“CME cattle futures had an early rally, but the break in Choice boxes turned the market lower,” Cassie Fish, market analyst, wrote in The Beef.
Live cattle futures closed lower, with the April contract down 95 cents to $234.42 and the June contract 75 cents lower to $233.85.
Cash trade was light, with 527 head sold for $372.
On the formula side, 22,600 head averaging 954 lbs. sold for an average of $375.19.
“This week’s negotiated fed cattle trade has been very slow to materialize with less than 1k head reported to the USDA, hardly a test,” Fish wrote. “With boxes on the defensive and yet another very small slaughter, this week’s cash price is expected to be steady at best, despite the bullish aspirations of cattle feeders.”
Today’s slaughter is estimated to be 103,000 head, 2,000 head below the previous week.
Boxed beef prices were mixed on 122 loads, with the Choice cutout down $8.22 to $391.69 and the Select cutout up 99 cents to $395.49. The Choice/Select spread was -$3.80.
“Poor wholesale beef demand pre-Easter is no surprise, but many weren’t that concerned because the weekly production schedule has been historically small all quarter, especially in recent weeks,” Fish said. “Expectations of a larger slaughter this week evaporated in the face of a building, unsold boxed beef inventory.”
Feeder cattle
Feeder cattle futures were mixed, with the March contract $1.57 higher to $361.87, the April contract $1.10 lower to $353.35 and the May contract down 65 cents to $350.05.
The CME Feeder Cattle Index was 26 cents higher to $361.59.
“Although demand has been good in the countryside, as the market continues to grow closer to the resistance at the 40-day moving average, traders yearn to see even more fundamental support before taking on such a resistance barrier,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments.
Corn futures closed higher, with the May contract up 4 cents to $4.67 and the July contract up 5 cents to $4.77.
Colorado: Winter Livestock in La Junta sold 853 head on Tuesday. Compared to the last auction, feeder steers under 550 lbs. sold mostly $7-9 lower. Steers over 550 lbs. sold $2-5 higher, with instances of sharply higher. Feeder heifers sold mostly $4-6 higher, with instances of sharply higher across all weight classes. Benchmark steers averaging 728 lbs. sold between $369-378, averaging $372.95.
Texas: Lonestar Stockyards in Wildorado sold 1,513 head on Tuesday. Compared to the previous auction, feeder steers traded $5-10 higher. Feeder heifers traded mostly steady. Steer and heifer calves were too lightly tested for a market trend, but increased buyer demand was noted on lighter-weight cattle with good flesh conditions that were suitable to turn out. Benchmark steers averaging 725 lbs. sold between $370-383, averaging $373.60. — Charles Wallace, WLJ contributing editor
