Weekly markets image

The market discovered some optimism midweek after a disappointing start to the week but found itself slipping back down by Thursday afternoon. Futures closed mostly lower, cash trade remains light in volume and boxed beef prices continue to decline—although not at a rapid pace.

Live cattle futures were mixed but mostly down another week. The October contract closed 38 cents lower to $123.22, and the December contract gained a nickel to close at $128.62.

Cash trade for the week was disappointing, with the bulk of trades (28,495 head) taking place Wednesday. By Thursday afternoon, volume was down to less than 8,500 head for the day. Hardly any trading took place on Monday and Tuesday. Lives steers sold between $120-125 over the week, averaging closer to $123. Dressed steers traded from $193-198, averaging about $196.

Cash trade for the week ending Sept. 19 totaled 58,361 head. Live steers averaged $123.85, and dressed steers averaged $198.56.

“Packers obviously have a lot of cattle around them in the form of various types of commitments,” remarked Cassie Fish, market analyst in The Beef. “If it has felt like the cash market volume is smaller than any time in history—that would be correct.” 

Fish added that year to date, more cattle harvested than ever before have fallen into the committed category. 

The Fed Cattle Exchange listed 3,941 head for its weekly Wednesday online auction. Cattle were offered from Kansas, Nebraska and Texas. A total of 444 head sold, all from Texas, for an average of $124.08. Opening bids for other lots ranged from $121-122, while most reserves were set around $124.

The national weekly direct beef type price distribution for the week of Sept. 6 to Sept. 13 was the following on a live basis:

• Negotiated purchases: $124.10.

• Formula net purchases: $127.15.

• Forward contract net purchases: $127.70.

• Negotiated grid net purchases: $128.48.

On a dressed basis: 

• Negotiated purchases: $198.54. 

• Formula net purchases: $202.23.

• Forward contract net purchases: $198.01.

• Negotiated grid net purchases: $202.75. 

Slaughter through Thursday totaled 477,000 head, compared to a year earlier at 483,000 head. Slaughter for the week ending Sept. 16 is expected to be 660,000 head, much closer to the industry target than has been seen over recent weeks. Actual slaughter for the week ending Sept. 11 totaled 579,277 head—short as a result of Labor Day weekend. 

Boxed beef prices continue to slow down. Over a week, the Choice cutout lost about $12 to close at $305.60, and the Select cutout lost about $5 to close at $274.99.

“In the old days, big profits and growing beef demand would cause packers to run harder,” Fish wrote. “In 2021, that is not the case. So, sluggish kills combined with more committed cattle than ever before results in a persistent inability to clean up the front end.”

Feeder cattle

The latest USDA Cattle on Feed report came out Sept. 24, after WLJ press time. Pre-report predictions estimated cattle on feed and placements to each be about 2 percent short of last year. Marketings are expected to be about half a percentage point off.

“Very little new fundamental market direction is seen during morning trade, although it is likely noncommercial traders are starting to retest the market following several weeks of liquidation,” Rick Kment, DTN contributing analyst, wrote in his Thursday midday comments.

Feeders were unable to find much momentum over the week, and futures closed lower. The September contract lost almost a dollar to close at $154.90, and the October contract lost 25 cents to close at $156.85. The CME Feeder Cattle Index gained about 47 cents over the week to close at $154.49.

Corn traded somewhat sideways, with the December contract closing at $5.29 and the March contract closing at $5.37.

Iowa: Russell Livestock Market in Russell sold 1,938 head Monday. Compared to the previous sale held two weeks earlier, steers under 700 lbs. were sharply lower, while those over 700 lbs. were $4-7 lower. Heifers 450-500 lbs. sold $3 lower, and 900-950 lb. heifers sold $3 lower. Benchmark steers averaging 786 lbs. sold between $157.75-166.35 and averaged $164.59.

Kansas: Winter Livestock in Dodge City sold 1,651 head Wednesday. Compared to a week earlier, feeder steers 800-1,000 lbs. sold $2-3 higher; 400-800 lbs. sold unevenly steady; and steer calves 300-400 lbs. sold $3-4 lower. Feeder heifers 700-950 lbs. sold $2-3 higher, and heifer calves 350-700 lbs. sold unevenly steady. Benchmark steers averaging 745 lbs. sold for $159.

Missouri: Joplin Regional Stockyards in Carthage sold 5,000 head on Monday. Compared to the sale held a week earlier, feeder steers and heifers traded $2-3 lower. Benchmark steers averaging 720 lbs. sold between $150-154 and averaged $151.41. 

Nebraska: Tri-State Livestock Auction in McCook sold 3,000 head Monday. Compared to the previous sale, steers under 550 lbs. were steady to $5 lower, and steers over 550 lbs. were $3-7 higher. Heifers were $1-6 lower, except on 450 lbs., which were $9 higher. Benchmark steers averaging 747 lbs. sold for $163.25.

Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 7,000 head on Monday. Compared to the last sale, feeder steers sold $1-3 higher, and feeder heifers sold $4-6 lower. Benchmark steers averaging 779 lbs. sold between $125-154 and averaged $150.65.

South Dakota: The Sioux Falls Regional Cattle Auction in Worthing, SD, sold 2,004 head Monday. Compared to a week earlier, feeder steers sold steady to $2 higher, except 850-900 lbs., which sold $6-8 lower. Feeder heifers sold steady to $2 lower, except 700-800 lbs., which sold $6-8 lower. Benchmark steers averaging 738 lbs. sold between $155-164 and averaged $161.39. Anna Miller, WLJ managing editor 

 

What do you think?

0
0
0
0
0

Load comments