Wednesday markets
Cattle futures closed lower as traders looked to the cash market for direction and focused on expectations for further seasonal weakness.
“CME cattle futures have eroded all day, the market action very weak and the market coming within pennies of last week’s low,” wrote Cassie Fish, market analyst, in The Beef.
Live cattle futures closed lower, with the October contract down $1.90 to $210.17 and the December contract $1.35 lower to $212.02.
Cash trade was moderate, with 15,616 head old. Live steers sold from $216-218, and dressed steers sold between $340-348. On the formula side, 19,600 head averaging 944 lbs. sold for an average of $358.58.
“Starting this morning, some light cash cattle trade has developed in Iowa and Nebraska at mostly $345, which is steady with last week’s weighted average,” ShayLe Stewart, DTN livestock analyst, wrote in her midday comments. “There’s yet to be any trade in the South, but the North has kicked the week off selling cattle at steady prices, which is better than what I assumed the week’s trend may be. It is worth noting that most of the cattle that have sold this morning have been committed for delivery for the week of September 14th.”
Today’s slaughter is estimated to be 100,000 head, 5,000 head lower than last week.
Boxed beef prices were lower on 95 loads, with the Choice cutout down 97 cents to $378.78 and the Select cutout $6.87 lower to $353.58.
Feeder cattle
Feeder cattle futures also closed lower, with the September contract down $1.37 to $318.97 and the October contract $1.02 lower to $314.37.
“Feeder cattle futures remain under pressure too as the cattle feeding industry eyes the recent big rally in corn and recalculates breakevens on fall placements,” Fish wrote. “Cheap corn has been the norm for three years and this dramatic price increase over the last three weeks has increased the cost of gains significantly, especially in the South.”
The CME Feeder Cattle Index was 17 cents lower to $329.14.
Corn futures ended their streak closing lower, with the September and December contracts down 2 cents to $5.18 and $5.43, respectively.
New Mexico: Roswell Livestock in Roswell sold 632 head on Tuesday. Compared to the last auction, steer calves 400-550 lbs. sold steady to $8 higher, with 500-550 lbs. trading $8 lower. Feeder steers 650-700 lbs. sold $7 higher. Heifer calves sold lower, except for 300-350 lbs. and 450-500 lbs., which sold steady to $7 higher. Feeder heifers sold lower. A group of benchmark steers averaging 713 lbs. sold for $318-320, averaging $319.75.
Texas: Lonestar Stockyards in Wildorado sold 460 head on Tuesday. Compared to the last auction, steer and heifer calves traded mostly $3-5 higher, with larger advances on lighter-weight cattle. Feeder steers traded mostly $1 higher. Not enough comparable sales were available for feeder heifers to establish a market trend. A group of fleshy, benchmark steers averaging 796 lbs. sold for $306.
Utah: Producers Livestock in Salina sold 725 head on Tuesday. Compared to the last report, feeder cattle sales were too few to test. A group of benchmark steers averaging 756 lbs. sold for $322. — Charles Wallace, WLJ contributing editor
