Wednesday markets
Live cattle futures continued to climb Wednesday as traders anticipated support from cash cattle trade and USDA’s efforts to improve price transparency in the cattle market.
“With the prevailing belief that fundamental support will develop later this week from hopefully both the fed cash cattle market and from Friday’s Cattle on Feed report, the live cattle contracts continue to charge higher,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments.
Stewart said USDA’s announcement of changes to Livestock Mandatory Reporting may also be supporting cattle futures, as the agency seeks to improve price transparency amid declining negotiated cash cattle trade and limited price reporting in the South. Additional details of the proposal are expected.
Live cattle futures closed higher, with the October contract up 97 cents to $230.42 and the December contract 95 cents higher to $231.12.
USDA reported no cash trade occurred today. On the formula side, 30,300 head averaging 964 lbs. sold for an average of $360.87.
Today’s slaughter is estimated to be 110,000 head, the same as last week.
Boxed beef prices were lower on 91 loads, with the Choice cutout down 71 cents to $372.59 and the Select cutout $6.20 lower to $355.34.
“The average of analysts’ estimates has been released ahead of Friday’s USDA monthly Cattle-on-Feed report and they are bullish,” wrote Cassie Fish, market analyst, in The Beef. “The average cattle-on-feed estimate for October 1 is 100.3 percent, average September placement estimate is 91.7 percent, which is record low for the third consecutive month and September marketings are estimated at 92.8 percent. With these estimates, it’s nearly impossible to anticipate anything but another bullish Cattle-on-Feed report.”
Feeder cattle
Feeder cattle futures also closed higher, with the October contract up $1.92 to $347.82 and the November contract $2.52 higher to $348.82.
The CME Feeder Cattle Index was $1.29 lower to $342.16.
Corn futures closed higher, with the December and March contracts up a penny to $4.63 and $4.77, respectively.
Montana: Miles City Livestock in Miles City sold 3,212 head on Tuesday. Compared to the last auction, feeder steers under 500 lbs. sold $4-8 lower, and over 500 lbs. sold $2-3 higher. Feeder heifers under 500 lbs. were too lightly tested to establish an accurate market trend. Feeder heifers over 500 lbs. sold $3-4 higher. Yearling steers and heifers were too lightly tested to establish an accurate market trend, but steady-to-higher undertones were noted. Benchmark steers averaging 734 lbs. sold for $370.
Texas: Lonestar Stockyards in Wildorado sold 1,050 head on Tuesday. Compared to the last auction, steer and heifer calves traded mostly $10 higher. Not enough comparable sales on yearlings for a market trend. A group of benchmark steers averaging 709 lbs. sold for $340.
Utah: Producers Livestock in Salina sold 2,081 head on Tuesday. Compared to the last auction, feeder steers sold unevenly steady, with heifers selling $16-23 higher, while 400-500 lbs. heifers sold sharply higher. Benchmark steers averaging 720 lbs. sold for $327.50-351.50, averaging $344.07. — Charles Wallace, WLJ contributing editor
