The cattle and beef markets decided to sit one out while other areas took the limelight. While the United States-Korea Free Trade Agreement (KORUS) renegotiation was finalized, and President Donald Trump accused China of meddling in our midterms while also announcing the potential of bilateral trade talks with Japan, the domestic markets were content to move sideways in almost every area.
By close of trade Thursday, Sept. 27, over 32,000 head of negotiated cash fed cattle had been confirmed sold for the week, with about half of that trade happening that day. Prices were relatively steady to slightly lower with the prior week at $108-110.50 (average $109.85) live and $174 dressed.
Movements in the near-term live cattle futures contracts was nearly nonexistent. From the Sept. 21 close to the Sept. 27 close, the October contract had gained a net 15 cents with $113.23 and the December contract had gained a net 13 cents with $118.58.
“Product values have been more sluggish than expected this week,” commented Andrew Gottschalk of Hedgers Edge. “The good news is prices have managed to hold in the previously identified support level of $202-205.”
The Choice beef cutout followed suit with the flat activity of cash cattle and the futures. Over the course of the week, Choice lost all of 9 cents with a Thursday close of $204.71. The Select cutout was slightly more mobile, losing $2.15 over the week to close Thursday at $192.56.
“Seasonally, the beef cutout should post a gain into the late-November period. Our initial objective remains $215,” continued Gottschalk.
Feeder auctions seemed to bounce between steady to triple volumes, and steady to usually $5 higher prices. Medium and large #1 cattle weighing between 700-800 lbs. were relatively plentiful, but a distinct two-tier market is developing between yearlings and calves.
Colorado: The Winter Livestock auction of La Junta sold close to double the volume of cattle last week compared to the week before. Light steer calves were called steady, while 4- and 5-weight steer calves were up $5-8. Heifer calves were uneven, ranging from down $5 to up $5 with preference for 6-weights. Demand was especially strong on the strings of long-weaned calves. One lot of benchmark yearling steers sold for $160.
Iowa: The Denison Feeder Cattle report had no trends to report as there haven’t been sales for a long time. Steers made up 60 percent of the 1,533-head offering. A single lot of #1,7-weight yearling steers averaged $166.70.
Kansas: Sales volumes came close to doubling at the Pratt Livestock Auction. The best test was on 8-weight steers, which were up $5-8. A higher undertone was noted on other classes of feeders. Benchmark steers ranged in price from $161.25-163.50.
Missouri: Calves were down at the Joplin Regional Stockyards last week. All calves were called $3-5 lower, except for steer calves under 400 lbs., which were called steady. Yearlings were steady to down $4. One lot of 762-lb. #1 yearling steers averaged $153.42 and were the heaviest #1 feeder steers on offer.
New Mexico: Volumes were relatively steady at the Clovis Livestock Auction. Prices, however, were mixed. Feeder steers under 600 lbs. and heifers under 500 lbs. were down $5-7. Heavier steers were up $1-4 and heavier heifers were up $1-2. Two lots of benchmark steer calves ranged from $132.50-136.
Oklahoma: The OKC West-El Reno saw feeder steers sell up $2-3 while heifers were up $1-2. Demand was called good for all classes of feeders. Two massive lots of #1, 7-weight yearling steers sold between $158-166.75.
South Dakota: The Hub City Livestock Auction saw almost triple the volume of cattle sell last week compared to the week before. As a result, there were few comparable market trends. The best comparison was on 9-weight steers and 8-weight heifers, which were both $1-2 higher. Demand was especially good on large lots of yearlings coming off of grass. Benchmark yearling steers ranged from $162.25-167.75.
Texas: The Amarillo Livestock Auction also saw its sales volume triple compared to its most recent sale. As such, there weren’t enough comparable sales for a market trend. Trade was called active on good demand. One lot of 117 head of #1, 706-lb. yearling steers averaged $165.
Wyoming: Things were relatively steady—both volume and prices—at the Torrington Livestock Commission. Compared to the prior sale, calves were steady while yearlings were steady to up $2. Benchmark yearling steers ranged from $158-168.
Just as in live cattle futures, near-term feeder cattle futures were very flat last week. Over the course of the week, the September contract gained a net 35 cents with $137.30. The October contract lost a net 23 cents with $157.85.
“Futures closed in the middle of the price range that has been developing over the past two weeks,” noted Robin Schmahl, contributing analyst with DTN.
“Traders digested the upcoming trade talks with Japan and began focusing back on beef demand.” — Kerry Halladay, WLJ editor
