The cattle market continues to trade in a sideways pattern, with most heads watching the cash market and waiting for higher bids—which typically come with higher slaughter levels and smaller supplies.
Live cattle futures traded mostly sideways but ultimately closed mixed over the week. The April contract lost 30 cents to close at $139.37, and the June contract gained 17 cents to close at $137.12.
“As has been the case for months, the first two months of live cattle futures look weary, and the further out the contract month, the more bullish the charts appear and the greater the premium,” remarked Cassie Fish, market analyst, in The Beef. “This has been a market that has overpromised and undelivered for many months.”
Cash trade through Thursday morning totaled about 75,000 head, with the bulk of trades on Wednesday and Thursday. Live steers sold mostly around $139 but traded as high as $143.50 on Thursday. Dressed steers averaged around $222. Cash trade was mostly steady with a week earlier.
“Smaller fed supplies, larger slaughter volumes and improving demand for beef has created underlying fundamentals for supporting higher market prices,” wrote the Cattle Report. “The puzzle is why cash prices for fed cattle are not participating. The cutout continues to work higher, and the slaughter remains a healthy level but fed prices are lagging.”
Cash trade through March 27 totaled 91,241 head. Live steers averaged $139.05, and dressed steers averaged $221.45.
The national weekly direct beef type price distribution for the week of March 14-21 was the following on a live basis:
• Negotiated purchases: $139.05.
• Formula net purchases: $141.48.
• Forward contract net purchases: $142.61.
• Negotiated grid net purchases: $140.74.
On a dressed basis:
• Negotiated purchases: $221.22.
• Formula net purchases: $223.07.
• Forward contract net purchases: $222.59.
• Negotiated grid net purchases: $224.33.
Slaughter through Thursday totaled an impressive 490,000 head, a few thousand head more than the same time a week earlier. Slaughter for the week ending March 24 is estimated at 659,000 head. Actual slaughter for the week ending March 19 totaled 636,158 head.
Boxed beef prices continue to climb higher. The Choice cutout gained almost $6 to close at $268.39, and the Select cutout gained nearly $10 to close at $262.34. The Choice/Select spread has begun to narrow again, sitting at $6.05.
Cattle and calves on feed in the latest Cattle on Feed report totaled 12.2 million head, up 1 percent from last year. Placements were 9 percent higher, and marketings were 5 percent higher. Other disappearances totaled 2 percent higher.
Feeder cattle
Feeder cattle continue to trade mostly lower. The March contract lost about 90 cents to close at $155.90, and the April contract lost about $1.30 to close at $161.40. The CME Feeder Cattle Index gained a little over a dollar to close at $155.76.
“October feeders are $20 premium to April feeders as the expectation of fewer feeders in the fall is reflected, again promising better days for ranchers,” Fish said. “Feeder futures too topped in February along with live cattle futures. And the question remains if and when those February highs will be challenged again in 2022.”
Corn futures traded mostly steady but found some gains midweek with the uncertainty regarding Ukraine/Russia. In addition, the annual Prospective Plantings and quarterly Grain Stocks reports released on Thursday sent futures higher, although not much from a week earlier. The May contract closed unchanged at $7.48, and the July contract gained about 5 cents to close at $7.33.
Iowa: Russell Livestock in Russell sold 3,290 head Monday. Compared to the last auction two weeks ago, feeder steers 350-450 lbs. were firm, 450-650 lbs. sold $5 lower and 650-850 lbs. traded $4-8 higher. Heifer feeders were mixed, with instances of $3 higher to $4 lower. Benchmark steers averaging 787 lbs. sold between $159.50-163.50 and averaged $161.32.
Kansas: Winter Livestock in Dodge City sold 2,400 head on Wednesday. Compared to a week earlier, feeder steers sold $4-6 higher, and feeder heifers weighing less than 800 lbs. sold steady to $2 lower, while over 800 lbs. sold $4-5 higher. Benchmark steers averaging 772 lbs. sold between $151.75-158.85, averaging $156.53.
Missouri: Joplin Regional Stockyards in Carthage sold 5,000 head on Monday. Compared to a week earlier, at the mid-session, feeder steers traded steady to $5 higher, and feeder heifers traded steady. Benchmark steers averaging 753 lbs. sold between $158-163, averaging $161.98.
Nebraska: Tri-State Livestock in McCook sold 2,870 head Monday. Compared to the previous auction, steers were steady to $5 higher, except weights over 900 lbs., which were $4 lower. Heifers were steady. Benchmark steers averaging 709 lbs. sold between $167-178.75, averaging $174.24.
New Mexico: Roswell Livestock in Roswell sold 1,021 head Monday. There is no comparison, as the last auction was three weeks ago. Trade was moderate to active, with the bulk of supply consisting of steers and heifers weighing 300-800 lbs. A small group of steers averaging 717 lbs. sold for $147.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 8,700 head on Monday. Compared to the previous sale, at the mid-session, feeder steers sold $2-4 higher, and feeder heifers sold $1-3 higher. Stocker cattle sold $5-9 higher. Steer calves sold $7-10 higher, and heifer calves sold $5-9 higher. Benchmark steers averaging 779 lbs. sold between $148.50-163, averaging $156.14.
South Dakota: Sioux Falls Regional in Worthing sold 3,944 head Monday. Compared to the previous auction, feeder steers sold steady to $5 lower, except 500-550 lbs. and 800-950 lbs., which were steady to $5 higher. Feeder heifers sold steady to $5 lower. Benchmark steers averaging 732 lbs. sold between $164.25-173 and averaged $167.43.
Wyoming: Torrington Livestock in Torrington sold 3,853 head on Wednesday. Compared to the previous auction, steer calves under 550 lbs. traded mostly steady. Steer calves over 550 lbs. traded $1-2 higher. Heifer calves traded $3-5 higher. Benchmark steers averaging 715 lbs. sold between $164-175 and averaged $169.84. —Anna Miller, WLJ managing editor
