Yesterdays markets were mixed with more things being down than up. But, as Cassie Fish of the Beef Report put it, it’s normal for the recent weeks.
“The theme of the last few weeks has been the same. Futures sideways, cash higher and the cutout lower.”
The near-term futures were mixed with live contracts up about 40-50 cents and the feeder contracts were down about 30 cents. Settlements were as follows: December live, $119.93; February live, $124.60; January feeders, $140.55; March feeders, $141.15.
“The market was mostly determined to trade lower,” summarized DTN’s ShayLe Stewart yesterday afternoon. “With slim demand for feeders, little market support and lean hogs taking a day of rest, it makes sense why a day of mostly sideways trade was determined.”
The cutouts continued lower yesterday, with the Choice cutout losing $1.35 with $225.60 and the Select cutout losing $2.19 with $208.12. The cutouts have been falling for most of the week and the past week, since peaking recently at the end of November.
“The largest percentage of the decline in boxed beef values has already occurred, though boxes won’t seasonally bottom until Q1,” Fish predicted.
The negotiated cash fed cattle came in yesterday at $118-119 (avg. $118.99) live and $187-189 ($187.68) dressed. Just under 38.3K head of negotiated cash fed cattle had been confirmed sold for the week.
“Yesterday afternoon saw Kansas, then Texas trip cattle at $119, disappointing to many who felt $120 was a cinch,” commented Fish this morning.
“But the pull of basis and the need for pen space trumped all else. Last week’s 5-area average was $118.21, so this week will be higher and above a year ago, which was $118.11. Still the sheer number of committed cattle and upcoming 2 weeks of holiday-reduced slaughter kept packers in charge.”