“Despite plentiful fundamental support, livestock contracts are trading in a wide range, trying to absorb all market signals,” ShayLe Stewart, DTN livestock analyst, remarked in her Thursday midday comments.
“Feeder cattle contracts continue to react adversely to corn’s behavior, while nearby live cattle contracts trade mildly higher, but deferred contracts scale lower thanks to burdensome resistance levels and worries about an overbought marketplace.”
Live cattle contracts saw some slight gains compared to the week prior, with the February contract at $116.45 and the April contract at $123.75 on Thursday.
Cash cattle markets struggled to develop all week, but finally found some volume Thursday, with 25,083 head selling between $111.50-114. Dressed steers sold at the $178-181 mark. The gap between negotiated dressed steers and formula cattle has been slowly closing, with a dollar or so difference between the two. Formula cattle have been selling at the high $170s-low $180s mark.
The week prior’s cash trade totaled 92,524 head. Live steers averaged $112.41 and dressed steers averaged $177.50. A total of 202,158 formula cattle sold that same week, averaging $177.72.
The Fed Cattle Exchange listed 1,362 head Wednesday during their weekly online sale. Of the total listed, 699 head sold at bids between $113.50-115. Texas sold 604 head at $113.75 and Oklahoma sold 95 head at $113.50.
Boxed beef prices may have hit their peak and are dwindling downward. The Choice and Select cutouts lost several dollars throughout the week, and settled Thursday at $234.25 and $220.44, respectively.
As of Thursday, a total of 470,000 head had been slaughtered. This was a few thousand head below the week prior and the year prior. Cargill has scheduled maintenance on a few of their plants, so that may have an impact on slaughter numbers over the next few weeks. The last week of January reported 653,000 head slaughtered.
Feeder cattle contract movement has been mostly dependent on the status of the corn contract, and March corn has continued to make small gains. As of Thursday, the corn contract was at $5.50, compared to the previous Friday’s $5.47. Feeder cattle contracts managed to find some momentum throughout the week, and closed Thursday with the March contract at $139.50 and the April contract at $142.67. This was a gain of a couple dollars for both contracts compared to the week prior. Thursday’s CME Feeder Cattle Index was reported at $136.27, up from the week prior.
“Feeder cattle sales this past week have been mixed with heavier feeders selling modestly lower. But the lighter weight calves that will make grass cattle next spring continue to sell with strong demand,” Stewart said.
“After the large runs of feeders in January, a lot of feedlots are at or near their capacity and don’t want to have to buy the feeders that need to go straight into the feedlot.”
Colorado: Winter Livestock in La Junta sold 2,433 head Tuesday. Compared to the last sale, feeder steers under 400 lbs. sold steady; 400-550 lbs. sold $3-4 higher; 550-700 lbs. sold steady to $2 higher; and over 700 lbs. sold $2-3 lower. Feeder heifers under 500 lbs. sold steady; five-weights sold steady to $3 higher; over 600 lbs. sold $1-2 lower. Benchmark steers averaging 716 lbs. sold between $132.50-140.
Iowa: Russell Livestock in Russell sold 3,736 head Monday. Compared to two weeks prior, steers under 650 lbs. sold $15-20 higher while the steers over 650 lbs. were mostly $6-11 higher. Heifers under 600 lbs. were mostly $5-6 higher and the heavier heifers were also mostly $5-6 higher. Benchmark steers averaging 720 lbs. sold between $139.75-150.75.
Missouri: Joplin Regional Stockyards in Carthage sold 4,016 head Monday. Compared to the previous sale, steers sold steady and up to $7 higher on 520 lbs. and under. Heifers sold $2-6 higher. Benchmark steers averaging 772 lbs. sold between $132.50-139.50.
New Mexico: Roswell Livestock Auction in Roswell sold 1,081 head Monday. Compared to the week prior, steer calves under 600 lbs. sold $9-15 higher; over 600 lbs. sold $1-3 higher. Feeder heifers and calves sold $5-9 higher; and a few 350-400 lbs. sold $13 higher. Benchmark steers averaging 714 lbs. sold between $125-138.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 10,758 head Monday. Compared to the previous sale, feeder steers sold $2-5 lower and feeder heifers sold $1-2 lower. Steer and heifer calves sold $2-4 higher on moderate to good demand. Benchmark steers averaging 720 lbs. sold between $128-141.50.
South Dakota: Sioux Falls Regional Cattle Auction in Worthing sold 4,029 head Monday. Compared to the prior week’s sale, feeder steers under 600 lbs. sold $2-5 higher with instances of $6-9 higher on 500-550 lbs.; 6-weights sold $2-3 lower; and over 700 lbs. sold steady to $3 higher. Feeder heifers under 600 lbs. sold $4-7 lower; 6-weights sold $4-7 higher; and over 700 lbs. sold $1-4 higher. Benchmark steers averaging 774 lbs. sold between $134-147. — Anna Miller, WLJ editor