Wednesday markets
Cattle futures closed sharply higher on limited cash trade.
“As the market transitions into the delivery month of June, one fact is obvious—there will be a convergence of the spot month futures contract with the cash market,” the Cattle Report wrote. “The spread is currently wide and there is no certainty of how the spread will close—only that it will close. Today, the futures moved sharply higher to close the gap with no cash trade to benchmark.”
Live cattle futures closed higher, with the June contract up $3.20 to $251.42 and the August contract $3.35 higher to $242.50.
“Thankfully, Wednesday’s bullish run has the contracts moving closer to the market’s 40-day moving average, which the complex fell below late last week,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments. “Still, no cash cattle trade has developed, and both bids and asking prices remain elusive at this point. Trade will likely be delayed until Thursday or Friday.”
Cash trade was light, with 215 head sold.
On the formula side, 23,300 head averaging 960 lbs. sold for an average of $412.94.
The national weekly direct beef type price distribution for the week of May 18-25 was the following on a live basis:
• Negotiated purchases: $260.56.
• Formula net purchases: $263.75.
• Forward contract net purchases: $245.60.
• Negotiated grid net purchases: $261.06.
On a dressed basis:
• Negotiated purchases: $410.04.
• Formula net purchases: $412.32.
• Forward contract net purchases: $384.45.
• Negotiated grid net purchases: $402.48.
Today’s slaughter is estimated to be 110,000 head, 5,000 head above last week.
Boxed beef prices were mixed on 144 loads, with the Choice cutout $1.82 higher to $394.72 and the Select cutout $1.01 lower to $389.29.
Feeder cattle
Feeder cattle futures also closed triple digits higher, with the August contract up $5.17 to $254.62 and the September contract $4.77 higher to $351.80.
Corn futures closed lower, with the July contract down 5 cents to $4.52 and the September contract down 4 cents to $4.59.
New Mexico: Roswell Livestock in Roswell sold 542 head on Wednesday. Compared to the last auction, steer calves 400-600 lbs. sold $5-12 lower, except 450-500 lbs. traded $10-15 higher. Feeder steers 600-700 lbs. sold $10 lower, except 900-950 lbs. traded $8 higher. Heifer calves sold $5-10 higher and there were no comparable sales on feeder heifers, but lower undertones were noted. A group of steers averaging 759 lbs. sold for $330.
Oklahoma: Beaver Livestock in Beaver sold 3,446 head on Tuesday. Compared to the last auction, feeder steers sold $4-5 lower, except 900-1,000 lbs. traded $5 higher. Feeder heifers sold $5-7 lower. Steer calves sold $5-6 lower. Heifer calves traded $5-10 higher, except for 500-600 lbs., which traded $14 lower. Benchmark steers averaging 774 lbs. sold for $377.50-391, averaging $381.29. — Charles Wallace, WLJ contributing editor
