Several portions of the market reached the post-fire milestone: returning to pre-fire levels.
Negotiated cash fed cattle was unfortunately not one of those markets.
“The week of the fire, the 5-area average was $112.37,” Cassie Fish of the Beef Report pointed out. “Two weeks after the fire it was $107.12. Last week it was $104.93. There is a good chance this week will average $107 or higher when all is said and done, still shy by $4.”
The negotiated cash fed cattle trade was again slow to develop last week. By the afternoon report on Thursday, not even 7,000 head had been confirmed sold for the week. Live prices on negotiated cattle on Thursday were $106, up slightly from the prior week’s average of $105.73. Expectations last week were for cash prices to be steady to higher than the prior week.
“Stronger cash bids sent CME cattle futures higher again yesterday, though today futures act tired and overbought, with the exception of spot Oct LC to seek higher ground as the bull spreads continue to grind out gains daily,” continued Fish.
“Today Oct LC filled the first gap left after the Finney County fire, today trading at the same price as it did on Aug. 9, the day of the fire. That is a $13.22 rally from the contract low reached Sept. 9.”
The near-term live cattle futures settled on Thursday at $106.80 for October (up a net $1.77 from Friday, Sept. 27’s settle) and $110.83 for December (+25 cents).
“The October live cattle contract broke above pre-Tyson fire prices Thursday afternoon at $106.80, which is the highest the contract has been since early August. Though live cattle contracts still struggle in shear cumulative volume, if nothing more, reaching $106.80 will help with countryside psychology,” observed DTN Analyst ShayLe Stewart.
Beef cutouts continued lower last week, as they have for several weeks now though the rate of loss seems to be slowing. The Choice cutout lost a net 52 cents over the week to close at $212.06 on Thursday, and the Select cutout lost a net $2.65 with $187.21.
Feeder cattle
The cash feeder cattle markets continue to gain strength. Average prices for medium and large #1 steers weighing 700-800 lbs. was solidly in the mid-$140s last week with the price ranges tightening up.
California: Volumes at the Cattlemen’s Livestock Market were up and prices were called steady. Despite the steady description of the prices, the price range on #1, 7-weight steers increased from the previous week to $125-150.
Colorado: The Winter Livestock auction of La Junta sold over double the number of feeder cattle last week compared to the prior week. Steer calves under 500 lbs. were steady, while heavier steer calves were up $5-7. Heifer calves under 400 lbs. were steady, while heavier heifer calves were up $3-5. Yearling steers and yearling heifers under 900 lbs. were up $3-5 with instances of up $8. Two lots of benchmark yearling steers ranged from $146-153.25.
Kansas: There were few comparable sales at the Winter Livestock auction of Dodge City last week, but a higher undertone was noted. Heifers had only a few comparable sales—650-750 lbs. down $3-4—and the rest were said to have a lower undertone. Calves also were poorly compared and described as having a higher undertone. One 70-head lot of #1, 748-lb. yearling steers averaged $151, while a nine-head lot of “fleshy” yearlings weighing 704 lbs. averaged $140.50.
Missouri: The sales volumes at the Joplin Regional Stockyards have been slowly creeping back up. Last week 5,254 head of feeders sold compared to the prior week’s 4,667 head. All classes of feeders were steady to up $3 last week with demand described as moderate to good. Two good-sized lots of benchmark yearling steers sold between $140-152.
Nebraska: The Tri-State Livestock Auction held steady on sales volume but saw steady to higher prices on feeders. Steers were called steady to $3 higher while heifers were steady to $8 higher. Demand was called good on all weights. There were no #1, 7-weight steers reported sold, but #1, 6-weight steers sold between $145-162, and the 61-head lot of #1, 812-lb. yearlings averaged $154.50.
New Mexico: The volume was down at the Clovis Livestock Auction by about 1,000 head. Prices were mixed on weight lines; calves under 600 lbs. were $1-3 down, while feeders over 600 lbs. were steady to up $2. Demand was called moderate on calves and good on feeders. One four-head lot of #1, 7-weight unweaned steer calves sold, averaging $117.50.
Oklahoma: The OKC West-El Reno sale saw slightly lower sales numbers but higher prices last week. Steers sold $1-4 higher while heifers were mostly steady on moderate to good demand. Demand on heavy feeders was called very good. Two large lots of #1, 7-weight yearling steers sold at $142.50-153.50.
South Dakota: Sale volume was pretty steady at the Hub City Livestock Auction too, with 4,251 head of feeders sold. The best test was on heavier steers which were steady to up $1. Heifers over 800 lbs. were steady to up $3. Demand was called very good for yearling offerings. No comment on calves. Two #1, 7-weight lots sold from $145-154.25.
Washington: The Toppenish Special Feeder Cattle Auction sold half again as many head of feeders last week compared to the week before. Prices were described as steady to $8 lower with the best demand being for yearlings coming off grass. There were no #1, 7-weight steers that sold, but the one lot of #1, 6-weight steers averaged $159.33. The several 7-weight lots in the medium and large #1-2 class ranged from $135-151.
Wyoming: Volumes were down but prices were up at the Torrington Livestock auction last week. Yearling feeders were up $2-5 with too few calf trades for a market trend. Benchmark yearling steers traded $153-156.
While live cattle futures gained last week, the near-term feeder cattle futures saw a net loss. The front-month of October lost about $2 over the course of the week with a Thursday settle of $142.35. The November losses were more minor, down a net 88 cents with $142.10.
“Last year at this time feeder cattle were trading around $157.00 before the market gave way to a downward seasonal trend,” noted Stewart. “Given the slight support found in the live cattle market, so long as cash cattle aren’t sold Friday for $1 to $2 lower, feeder cattle should close the week on a steady note.” — Kerry Halladay, WLJ editor
