Cattle markets were a bit livelier today. Futures contracts turned mostly green, with the August live cattle contract gaining 55 cents to $101.45 and October gaining $1.05 to $106.09. August feeder cattle contracts gained $1.27 to $141.97 and September also gained $1.27 to $142.57.
Estimated daily slaughter was 119,000 head today and 355,000 head for the week so far. The same week last year packers processed 360,000 head. Beef prices have found a narrow trading range wit the Choice cutout at $201.64 and Select at $188.94 on 108 loads. Average carcass weights were 878 lbs. last week, which is 34 lbs. heavier than last year. A total of 83.6 percent graded Choice or better last week.
Cassi Fish, market analyst in The Beef opined “Optimism is widespread as expectations grow that the lowest wholesale beef prices for July in seven years will stimulate such demand, that a lower low in wholesale beef prices post-Labor Day will not occur in 2020 as it has the last few years. Today, boxes illustrate their continued struggle by dropping $1.32 thanks to a weak chuck.
“The weakest U.S. dollar in 2 years is also raising hopes that exports, which have been the U.S. protein industries’ most import growth segment the last 3 years, will advance further, absorbing next year’s on-coming record domestic protein production.”
ShayLe Stewart, DTN market analyst, outlines today’s futures trade, “Live cattle contracts have traded steadily higher all throughout Wednesday’s morning hours. Aided by the strength rallying in the feeder cattle complex both on the board and throughout the nation’s sales, the market has scaled steadily higher and has been accompanied by slightly stronger cash cattle sales.
“Cash cattle trade started the day out with Wednesday’s Fed Cattle Exchange, where there was a good test of the market, and after the online sale, some interest was noticed throughout the countryside. There have been a few deals reported by a regional packer in Nebraska for $160, and some light trade developed in Texas for $97.”
A total of 37,529 head traded on the negotiated cash trade market today in the Texas Panhandle. Negotiated cash trading and demand have been moderate. Compared to last week, live purchases moved mostly $1 higher at $97. In Kansas, negotiated cash trading has been moderate with good demand. Compared to the prior week, live purchases moved mostly $1 higher at $97. In Nebraska and the western Corn Belt, negotiated cash trading has been slow with light demand. In Nebraska a few dressed purchases moved at $160.
In the western Corn Belt, a few live and dressed purchases moved at $101 and $160, respectively. However, there were not enough trades for a full market trend. In Nebraska last week live purchases moved at 98 and dressed purchases moved at 158. Thus far for Wednesday in Colorado, negotiated cash trading was inactive on very light demand. There were not enough purchases for a market trend. There were 22,800 head traded through the formula grid market, which averaged $154.01 and weighed 881 lbs.
The feeder cattle contracts are leading the upward trend in the cattle market as their support is noted—optimism and strength is transpiring on the board, and there is plenty of buyer interest through this week’s sales. The market’s ambition will be pressured once again by the strong resistance embedded at $144.
Phillip Livestock Auction in Phillip, SD, offered 4,078 head today and reported very good demand for several long strings, load lots, and many packages of feeder steers and feeder heifers which sold on a strong, active market throughout the sale. Much of the offering was home raised, off grass, and carrying light to moderate flesh. Benchmark steers weighing 780 lbs. averaged $147.39 in yesterday’s sale.
Superior Livestock Auction is selling lots of western calves this week at the Video Royale sale in Winnemucca, NV. One sale of note was a set of 430-lb. steer calves with all the bells and whistles selling for $218 for September delivery. Steer calves weighing 425 lbs. sold for $196, a $22/cwt premium for third party verified attributes. — Pete Crow, WLJ publisher