Lackluster cash trade proved to be the standard last week. Futures continue to trade at mostly sideways levels. Declining, but still seasonally high boxed beef prices prove beef demand is there, and should hopefully encourage packers to keep things moving.
Live cattle futures traded mostly sideways all week, closing Thursday with the August contract at $120.80 and the October contract at $126.67.
Cash trade last week was somewhat disappointing, with light volumes and mediocre prices. While most cattle sold between $117-125, the average was closer to $120. Dressed cattle traded from $195-197. Formula cattle are still selling just under the $200 mark.
“The marketplace is trending more towards historically typical weeks when most trading is concluded at week’s end,” wrote the Cattle Report. “Buyers are more reluctant to pay up for cattle early in the week and sellers are more resolved to hold on to higher asking prices with smaller show lists.”
Negotiated cash trade through the week ending July 17 totaled 75,811 head. Live steers averaged $122.97 and dressed steers averaged $198.94.
The Fed Cattle Exchange listed 3,367 head for sale Wednesday. Of that, only 426 head actually sold. Texas sold all the successful lots for $119. Reserve prices for other lots ranged from $118-124. The Exchange also held a special Thursday sale and offered 2,295 fed cattle from Kansas and Texas. A total of 304 head from Texas sold for $118.75. High bids for other lots reached $119, but reserve prices ranged from $118-121.
Slaughter through Thursday totaled 467,000 head, about 12,000 head behind the same time a week earlier. Another slaughter plant was expected to be dark for the weekend, so a lower weekend kill was also expected. Slaughter for the week ending July 17 is projected to reach 653,000 head. USDA released actual slaughter data for the week through July 10, which only totaled 580,744 head. This was the Fourth of July holiday-shortened week, so slaughter numbers were expected to be substantially lower.
“Slaughter levels are big enough to keep fed cattle supplies manageable but not so big the industry can become fully current,” remarked Cassie Fish, market analyst, in The Beef. “Some feedyards are unable to get fully cleaned up on the front-end, a reality they have learned to live with.”
Boxed beef prices have continued to decline but are still seasonally high. The Choice cutout lost about $6.75 over a week and the Select cutout lost about $4 in a week.
“Thankfully, these higher boxed beef prices do show that consumer demand is still thriving throughout the market and should continue to encourage packers to keep running these moderate kill speeds, which will lessen the chance of supplies backing up in the feedlot sector,” remarked ShayLe Stewart, DTN livestock analyst.
Beef exports for the year were up from the week earlier and 63 percent higher than the four-week average. Net sales totaled 25,100 metric tons (mt), with the largest buyers South Korea (8,600 mt), Japan (5,200 mt) and China (4,100 mt).
Feeder cattle
The Cattle on Feed report was released July 23, after WLJ press time. Pre-report estimates expected slightly less cattle on feed, 5 percent less placements and 2 percent more marketings. Pre-report estimates for the mid-year Inventory report projected most classes of cattle to be down, with total cattle and calves down 0.6 percent and the calf crop to down 0.7 percent.
Feeders traded mostly sideways through the week, closing Thursday with the August contract at $158.20 and the September contract at $160.70. The CME Fed Cattle Exchange closed Thursday at $151.39, down 96 cents from a week earlier.
Corn prices have slowed their rate of gain and traded mostly lower all week, with the September contract at $5.64 and the December contract at $5.61.
“Watching how the spring contracts of 2022 perform will continue to be an influencing factor for this year’s calf market as feedlots have seen enough fat cattle trade at $120 this past year and desperately hope that $130 is achievable in 2022,” Stewart said.
Video markets are still selling red hot at their summer sales. Northern Livestock Video released their unofficial averages for their Summertime Classic sale, which sold 90,010 steers and 42,425 heifers. Steers averaging 617 lbs. sold for an average of $170.41 and heavier steers averaging 873 lbs. sold for an average of $158.07. Heifers that averaged 516 lbs. sold for an average of $163.72 and heavier heifers that averaged 867 lbs. sold for an average of $149.91.
Kansas: Winter Livestock in Dodge City sold 546 head Wednesday. There were not enough steers and heifers for a market test, but a steady trend was noted. A small group of benchmark steers averaging 744 lbs. sold for $144.50.
Missouri: Joplin Regional Stockyards in Carthage sold 4,211 head Monday. Compared to a week earlier, at the mid-session feeder steers and heifers were trading $2-3 higher. Benchmark steers averaging 764 lbs. sold between $148-158.
New Mexico: Roswell Livestock in Roswell sold 880 head on Monday. Compared to the prior sale, feeder steers and heifers and calves were mostly $4-8 higher. Replacement cows and pairs are in very good demand, with producers beginning to replace their herds that were reduced or dispersed during the drought conditions that have been in effect the past few years throughout the trade area. A small group of steers averaging 720 lbs. sold for $156.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 7,184 head Monday. Compared to the prior sale, feeder cattle and calves sold unevenly steady. Early demand was moderate to good. Benchmark steers averaging 771 lbs. sold between $148-159, averaging $151.63.
South Dakota: Sioux Falls Regional Cattle Auction in Worthing sold 927 head Monday. Compared to the previous sale, feeder steers and heifers did not have a good comparison due to a limited offering. However, steers 900-950 lbs. sold steady; heifers 600-650 lbs. sold steady to $4 lower; heifers 750-800 lbs. sold $2-3 lower; heifers 800-850 lbs. sold $6 lower; and 950-1,000 lbs. sold $1-2 higher. Benchmark steers averaging 727 lbs. sold between $153-154.25, averaging $154.25. — Anna Miller, WLJ managing editor
