Tuesday markets
Cattle futures were higher today, making up some of the ground lost yesterday, while boxed beef prices continued to decline.
Live cattle were higher today, with the June contract up 45 cents to $122.55 and the August contract up 32 cents, closing at $121.92.
Cash trade was very light, with 396 head trading at $126.50. Dressed steers sold at $200. On the formula side, 26,600 averaging 844 lbs. sold for $199.44.
“With last week’s disappointing movement, one would like to believe packers would be forced into committing desperately needed supplies this week through the cash market,” remarked ShayLe Stewart, DTN livestock analyst, in her midday comments. “But with the Fourth of July affecting processing speeds this week and most likely next week as well, packers have a little bit of wiggle room.”
Slaughter for the day is expected to be 120,000 head—a thousand head below last week.
According to The Livestock Report by the CME Group, USDA showed total cattle slaughter in May was 2.698 million head, 18.5 percent higher than the COVID-disrupted slaughter a year ago. When adjusting for the marketing day discrepancy, slaughter in May was 1 percent higher than in 2019. Adjusted daily slaughter may have been higher than in May 2019, but there were significant differences in steer and heifer slaughter. Average daily steer slaughter in May was 66,735 head, 3.6 percent lower than in 2019, while daily heifer slaughter at 37,640 head/day was 3.2 percent higher than in 2019.
Boxed beef prices continued to drop, with the Choice cutout down $5.09 to $292.34 and the Select cutout lower $3.56 to $270.40. The Choice/Select cutout spread was $21.94 on 127 loads.
Feeder cattle
Feeder cattle traded higher, making up some of the ground lost yesterday, with the August contract up $1.05 to $157.40 and the September contract up 72 cents to $159.80. The CME Cattle Feeder Index was higher 54 cents, closing at $146.72.
Corn contracts were modestly higher, with the July contract up 19 cents to $6.94 and September up a penny a bushel to $5.59.
Tomorrow the USDA releases the Crop Acreage Report and as The Cattle Report noted, “Few people doubt the USDA acreage report will fail to raise the estimate of corn acres for this year’s crop. The previously estimated 91 million acres is likely to be replaced with an additional 2-2.5 million acres. Futures prices have built into the price an increase but how meaningful the size increase impact will contribute to new pricing is an open question.”
USDA released the Crop Progress report on Monday, showing 64 percent of the corn crop as rated good-to-excellent, a 1 percent drop from last week and below last year’s 73 percent rating. Another 28 percent of the crop is rated fair, with the remaining 8 percent rated poor or very poor (up two points from last week). South Dakota showed a continued decline in corn quality, with 24 percent of the crop rated good-to-excellent. The U.S. had 4 percent of its corn crop in the silk stage versus the 6 percent five-year average.
Winter wheat harvest is moving along with 33 percent completed. Spring wheat ratings fell even more than anticipated, losing another seven points with just 20 percent now rated in good-to-excellent condition.
Pasture and range conditions will be published on Thursday with the Drought Monitor report.
New Mexico: Roswell Livestock in Roswell sold 1,424 head on Monday. Compared to the previous auction, steer and heifer calves under 600 lbs. sold $5-10 lower, though quality was not as attractive and feeders over 600 lbs. were mostly $2-4 lower. A small group of steers averaging 822 lbs. sold for $136. — Charles Wallace, WLJ editor
