Wednesday markets
The cattle complex closed mixed as traders were skeptical that the market had reached its top.
Live cattle futures were lower, with the October contract down 90 cents to $188.40 and the December contract down $1.52 to $186.42.
“The live cattle complex continues to trade lower as traders are liquidating some market positions as they worry about the complex being overbought,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments. “I expect that some of this pressure will ease after the end of the month, and money managers will move some of their positions around, especially if market fundamentals continue to remain strong. Yes, boxed beef prices are seeing a little bit of pushback this week, but slaughter speeds are expected to remain aggressive and it’s unlikely that feedlot managers let cattle trade for anything less than steady this week as their showlists are current, which gives them leverage.”
Cash trade began to transpire, with 16,987 head sold. Live steers traded between $187-190, averaging $189.87, and dressed steers sold for $298.
On the formula side, 24,300 head averaging 906 lbs. sold for an average of $302.42.
“Interestingly, the negotiated cash trade started yesterday in Iowa at $189 and in Texas and Kansas today at $190,” Cassie Fish, market analyst, wrote for The Beef. “Some are passing bids, attempting to get another $1 or more. But with a toppy wholesale beef market, packers are willing to pay steady and keep production elevated in order to book more profits this quarter. Paying up, on the other hand, given the large volume purchased last week, is not appealing and could be argued that it is not necessary.”
Today’s slaughter is estimated to be 124,000 head, the same as a week earlier.
Boxed beef prices were lower on 154 loads, with the Choice cutout down $1.17 to $319.44 and the Select cutout down 64 cents to $289.32.
Feeder cattle
Feeder cattle were mixed, with the October contract up 92 cents to $250.95 and the November contract down $1.10 to $245.50. The CME Feeder Cattle Index was up 57 cents to $250.06.
Corn futures were lower, with the December contract down 2 cents to $4.11 and the March contract down a penny to $4.25.
Colorado: Winter Livestock in La Junta sold 935 head on Tuesday. Compared to the last auction, feeder steers sold $7-16 higher, with instances of sharply higher across all weight classes. Feeder heifers sold $2-12 higher, with instances of sharply higher across all weight classes. Benchmark steers averaging 784 lbs. sold for $240.50-258, averaging $252.98.
Texas: Lonestar Stockyards in Wildorado sold 1,865 head on Tuesday. Compared to the last auction, feeder steers and heifers traded mostly steady on limited comparable sales. Heifer calves between 600-700 lbs. traded mostly $5 higher. There were not enough comparable sales on steer calves for a market trend, but a lower undertone was noted. A group of steers averaging 776 lbs. sold for $255.
Wyoming: Winter Livestock in Riverton sold 5,243 head on Tuesday. Compared to the last auction, steer calves under 500 lbs. sold $6-13 higher, with instances of $23-36 higher, over 500 lbs. were mostly steady, except for 600-645 lbs. sold $17 higher. Heifer calves under 500 lbs. sold $9-11 higher, with instances of $22 higher, and over 500 lbs. were steady, except for 600-635 lbs. traded $9 higher. Yearling heifers sold on a light offering, with instances $4-10 lower. Benchmark steers averaging 720 lbs. sold for $242-257.50, averaging $245.08. — Charles Wallace, WLJ contributing editor
