Cattle markets were slow to develop with the Christmas and New Year’s holidays, but will hopefully pick up the pace as we enter a new year.
“Following the strong trade that the cattle contracts saw earlier in the week, traders have grown distant from the live cattle and feeder cattle contracts and most likely are waiting until after the first of the year to see where the market’s true direction lays,” remarked DTN Livestock Analyst ShayLe Stewart in her Wednesday afternoon markets comments.
Cash cattle trade was slow to nonexistent Monday and Tuesday, but gained some ground Wednesday with 12,377 head sold. Live cattle sold from $109-112 and dressed steers sold between $175-176. Fed cattle trade is at a 10-year low for December—Last December, cash cattle prices were at $122.
The Fed Cattle Exchange hosted their weekly online sale, but was unable to secure many bids. Out of 1,015 head offered, 194 head sold for an average of $111.
Live cattle futures have traded mostly sideways: The December contract closed at $112.12 and the February contract at $114.45 on Wednesday—within a dollar of the prior Wednesday’s close.
Boxed beef prices hit their seasonal low and are beginning to climb higher again. The Choice cutout settled at $210.53 and the Select cutout was at $199.86 Wednesday afternoon.
Slaughter for the week ending Dec. 25 was at 419,000 head, several hundred thousand head behind usual schedule, but obviously because of the shortened kill week. Last week’s slaughter as of Wednesday was at 352,000 head, with a big New Year’s Eve and Saturday slaughter expected. Packer margins are still significant at $273.40, but nearly half as much as a month ago, according to the Sterling Beef Profit Trackers. As of Dec. 25, feedlots were making $83.50 a head and cow-calf producers $123.50 a cow.
Corn prices are trading at a six-year high, but feeder cattle are continuing to hold their ground—although starting to slip lower.
“The pressure from rising feed costs continues to worry feedlots but once the market turns to 2021 and regains some normalcy following the holiday jitters, it will become more apparent how real the corn market’s price levels are,” Stewart said.
As of Wednesday, the March corn contract was trading at $4.74. Feeder cattle were trading all week around $140, but the January contract closed at $138.52 and the March contract at $139.75. The CME Feeder Cattle Index was reported at $138.71.
Kansas: Winter Livestock in Dodge City sold 395 head last Wednesday. Compared to two weeks earlier, feeder steers 400-750 lbs. sold steady on light receipts. Feeder steers 750-900 lbs. sold $2-5 higher. Feeder heifers 350-800 lbs. sold steady on light receipts. Benchmark steers averaging 785 lbs. sold between $144.75-145.25, and averaged $144.90.
Nebraska: Tri-State Livestock Auction in McCook sold 550 head Monday. Due to lesser numbers from the holiday weeks, there were no comparisons. Benchmark steers averaging 784 lbs. sold for $149.
Missouri: Callaway Livestock Center in Kingdom City sold 2,298 head last Monday. Compared to the auction two weeks prior, there were too few steer and heifer calves to fully test the market. Steers weighing 650-800 lbs. sold fully steady to firm. Feeder heifers over 600 lbs. were lightly tested. Benchmark steers averaging 783 lbs. sold between $139.50-142, and averaged $141.03.
South Dakota: Sioux Falls Regional Cattle Auction in Worthing sold 1,966 head Monday. Compared to two weeks prior, there were too few steer calves offered to fully test the market, but heifer calves sold mostly steady in a light test. The offering of yearling steers was of weights not similar to the prior sale, but a higher undertone was noted. Yearling heifers were $3 higher, except 800-850 lbs. sold $5-10 higher. — Anna Miller, WLJ editor