Markets traded mostly sideways last week. Cash trade volume has continued to be slighter than preferred, although prices are holding fairly steady. Feeders have seen good demand, with the summer video auctions in full swing.
Live cattle futures were able to find some gains earlier in the week, but lost their momentum by mid-week. Still, contracts were slightly higher than a week earlier. The August contract closed at $121.12 and the October contract closed at $126.52.
“If boxed beef prices were trading steady to even somewhat higher, or if the market had moved a significant volume of cash cattle for steady to higher prices, than the market would be in a different position, but unfortunately that’s not the case in either instances,” remarked ShayLe Stewart, DTN livestock analyst.
Cash trade throughout the week was slight in volume. Live steers sold between $117-124 and dressed steers traded between $197-201. Formula cattle have continued to sell around the $195-197 mark.
Cash trade through the week ending July 11 totaled only 82,381 head. Live steers averaged $122.52—almost $1.50 lower from a week earlier—and dressed steers averaged $198.19—5 cents lower than the week prior.
Central Stockyards’ Fed Cattle Exchange offered 4,322 head Wednesday, of which 364 head sold. All of the successful lots came from Texas, which sold between $117-119.50. Reserve prices for other lots ranged from $118-122.
“Some packers are bought out as far as August 8, though there is some indication plants are finally running a little better,” wrote Cassie Fish, market analyst, in The Beef. “Some packers are able to move cattle up some in the schedule, which hasn’t been true in a long time.”
Total slaughter through Thursday was estimated at 479,000 head. If slaughter levels were able to stay on pace Friday and Saturday, the week’s slaughter total will be a decent one. However, there were some industry rumors that a plant would be down for Friday and Saturday, followed by a separate plant the following week.
Slaughter for the week ending July 8—the week of the observed July 4 holiday—is projected to reach only 582,000 head. Actual slaughter for the first week of July totaled only 628,441 head.
Boxed beef prices have steadily been headed downward. The Choice cutout lost about $12 over the week to close at $272.88 and the Select cutout lost about $8 to $253.75.
USDA’s latest WASDE (World Agricultural Supply and Demand Estimates) report projected third-quarter steer prices up $5 from last month to average $120, and fourth-quarter steer prices up $3 to $123.
Beef imports were unchanged from a month ago, but exports grew by 80 million pounds to 3,422 million pounds for 2021.
Feeder cattle
Feeders traded higher through the beginning of the week, stumbled a bit Wednesday, but managed to find some slight recovery Thursday. The August contract closed at $157.37 and the September contract at $159.22. The CME Feeder Cattle Index closed Friday at $152.35, 84 cents higher than a week earlier.
The July corn contract closed Wednesday, bringing prices back under $6. The September contract settled at $5.64 and the December contract at $5.56.
“Given the constant game of cat and mouse that the corn and feeder cattle contracts like to play, it’s incredibly helpful when the market’s able to muster support from another source other than the corn market’s fate,” Stewart said.
Pre-report estimates for the July 23 Cattle on Feed report project numbers to be closer to the same time last year. Cattle on feed as of July 1 are estimated to be 99 percent of last year. June placements are projected to reach about 95 percent of last year, and marketings are expected to reach 102 percent.
While placements rebounded strongly last June, the year-to-date comparison shows a pullback in placements. Drought continues to be a determining factor in the West, and lightweight cattle may be placed earlier this year. Feeder cattle imports were down about 40,000 head in June, contributing to lower placements.
Demand was red hot during Western Video Market’s auction in Reno last week. A week earlier, feeder cattle traded on average $6-10 stronger than the previous week, so the sale took place with a strong undertone bolstering the market, Stewart remarked earlier in the week.
Iowa: Russell Livestock in Russell sold 1,105 head Monday. Compared to the last report two weeks earlier, steers calves 450-550 lbs. sold $5 higher and over 550 lbs. sold $3 lower to $5 higher. Heifer calves 400-650 lbs. sold firm and 650-800 lbs. sold $7 higher. Benchmark steers averaging 753 lbs. sold between $153-161.50, averaging $159.74.
Missouri: Joplin Regional Stockyards in Carthage sold 4,500 head Monday. Compared to two weeks earlier, feeder steers and heifers sold steady to $2 higher at mid-session. Demand was good to very good. Benchmark steers averaging 757 lbs. sold from $151-156, averaging $153.55.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 8,700 head Monday. At mid-session, feeder steers and heifers traded $3-5 higher than two weeks earlier. Steer calves sold $1-2 higher and heifer calves sold $3-5 higher. Benchmark steers averaging 771 lbs. sold between $145-155, averaging $151.49.
South Dakota: Sioux Falls Regional Cattle Auction in Worthing sold 2,845 head Monday. Compared to two weeks earlier, feeder steers and heifers sold unevenly steady. Benchmark steers averaging 781 lbs. sold between $149.75-155, averaging $150.90.
Wyoming: Torrington Livestock in Torrington sold 1,296 head Wednesday. There was no market trend as it was the first feeder special of the summer. Benchmark steers averaging 727 lbs. sold between $155-170.70, averaging $160.76. — Anna Miller, WLJ managing editor
