Wednesday markets
Despite a favorable World Agricultural Supply and Demand Estimates (WASDE) report and lower corn futures, the livestock complex couldn’t muster any support.
“Wednesday’s WASDE report favors the cattle and beef markets in a mostly supportive fashion,” ShayLe Stewart, DTN livestock analyst, wrote in the midday comments. “Beef production for 2022 was raised by 211 million pounds as aggressive throughput on fed cattle, combined with heavier carcass weights, contributes more beef to the market. For 2023, beef production was decreased by 90 million pounds as the market expects few cows to be slaughtered and tighter fed cattle supplies. Quarterly steer prices for 2022’s fourth quarter jumped by $4 from last month to average $152. For 2023, first-quarter steer prices are anticipated to average $153 (up $2.00 from last month) while second quarter prices in 2023 are anticipated to average $154 (up $2.00 from last month as well).”
Live cattle closed lower, with the December contract down $1.47 to $151.57 and the February contract down 62 cents to $154.15.
Cash trade began to pick up for the week, with 20,994 head selling between $150-153, averaging $152.16. Dressed steers sold between $237-242 and averaged $240.28. Trade was mostly at $150 in the South, and a few dressed purchases traded at $238 in Kansas. In Nebraska, dressed sales were reported at $242.
On the formula side, 20,200 head averaging 886 lbs. averaged $244.81.
“Packers purchased 20K cattle with time last week, allowing them to keep a toe hold on inventory as market-ready fed cattle supplies shrink,” Cassie Fish, market analyst for The Beef, wrote. “There has been practically zero action in the cash cattle market this week. Packers have done a masterful job so far and kept their margins black and their throughput humming at the best Monday through Friday pace since Q2 2019.”
Slaughter for today is expected to be 129,000 head, the same as last week.
Boxed beef prices closed lower on 142 loads, with the Choice cutout down 27 cents to $264.67 and the Select cutout down 83 cents to $235.22.
The Daily Livestock Report wrote the Choice cutout has risen $21 (8.7%) compared to the cutout value at the end of September. During the last six weeks, the biggest price increase in percentage terms has come from the chuck primal, up $37/cwt, or 19%. The second largest contributor is the rib primal, which has gained $52/cwt, or 13%, in the last six weeks.
“The increase in wholesale beef prices in October is not that unusual although it is quite impressive that beef prices have managed to rally at the same time that fed cattle slaughter remains above year-ago levels and consumers are facing double-digit price increases across a range of products at the supermarket,” the Daily Livestock Report wrote.
Feeder cattle
Feeder cattle also closed lower, with the November contract down 55 cents to $177.72 and the January contract down 25 cents to $179.65. The CME Feeder Cattle Index was down 29 cents to $176.30.
Corn closed lower, with the December and March contracts down 3 cents a bushel to $6.64 and $6.70, respectively.
Colorado: Winter Livestock in La Junta sold 1,572 head Tuesday. Steer and heifer calves were too lightly tested last week for a comparison. A group of steers averaging 789 lbs. sold for $170.50.
Texas: Lonestar Stockyards in Wildorado sold 1,570 head Tuesday. Compared to the previous auction, feeder steers traded mostly steady. Feeder heifers sold mostly $1-2 higher. A group of steers averaging 625 lbs. sold for $180.
Wyoming: Winter Livestock in Riverton sold 5,614 head Tuesday. Compared to the last auction, feeder steers and replacement heifers sold with higher overtones. The best advances were on 550-600 lb. steer calves, with instances of $5-10 higher. Heifer calves sold unevenly steady, with instances of $1-4 lower, and others were $3-5 higher. A group of steers averaging 749 lbs. sold for $161. — Charles Wallace, WLJ editor
