Traders were cautious about pushing the market too much ahead of the Cattle on Feed (COF) report and the Cattle Inventory report, with live cattle slightly up and feeder cattle mainly closing sideways. Cash trade was mostly $1-3 lower as hot weather propelled cattle to market. Auction barns in the South are reporting feeder steers steady to $4 lower, with instances of $6 lower or more on lighter steer and heifer calves.
The July COF pre-report estimates show that analysts expect the July 1 cattle on feed number to be marginally above a year ago at 100.1 percent, according to the Daily Livestock Report. Analysts expect June cattle placements to be 94.7 percent of a year ago, down to 1.581 million head, which would be the lowest number for the month of June since 2016. Cattle marketings are expected to be higher in June, at 102 percent, or 2.062 million head, the highest for June in over a decade.
Analysts also released their pre-report estimates for the July 1 Cattle Inventory report, showing all cattle and calves on July 1 are expected to be down 2.1 percent to 98.683 million head. Cows and heifers that have calved are estimated to be 2.6 percent lower to 39.739 million head.
Live cattle traded higher to start the week and continued to inch upward. The August contract was up 32 cents to close at $135.72, and the October contract was up $1.05 to close at $140.97.
Cash trade through Thursday totaled 51,000 head. Live steers sold between $136-144, averaging $141.75. Dressed steers averaged $227.02.
Trade was mostly $136 in Texas and Kansas, $1 lower than the prior week’s average. Dressed deals in Nebraska were mainly at $227, $3 lower, and live deals were at $142, $1-3 lower than the prior week.
Cash trade through last week totaled 85,183 head. Of that, 71 percent (85,183 head) were committed to nearby delivery, while the remaining 29 percent (24,917 head) were committed to deferred delivery.
The national weekly direct beef type price distribution for the week of July 11-18 was the following on a live basis:
• Negotiated purchases: $141.92.
• Formula net purchases: $145.30.
• Forward contract net purchases: $150.83.
• Negotiated grid net purchases: $142.07.
On a dressed basis:
• Negotiated purchases: $230.04.
• Formula net purchases: $228.10.
• Forward contract net purchases: $220.93.
• Negotiated grid net purchases: $232.11.
Slaughter through Thursday was 497,000 head, and slaughter for the week is projected to be 672,000 head. Actual slaughter for the week ending July 9 was 587,700 head. Dressed weights were 890 lbs.
Boxed beef prices were strong to start the week but slipped on Wednesday and Thursday, with the Choice cutout down 29 cents to $267.76 and the Select cutout lower 73 cents to $240.53.
Feeder cattle
Feeders ran out of gas midweek despite the weakness of corn as traders were waiting for the COF and inventory reports. The August contract lost 63 cents to close at $178.27, and the September contract was down 32 cents to close at $181.30. The CME Feeder Cattle Index was down $3.38 to $170.67.
“In order for the market to continue its upward quest, demand will need to continue to show unwavering interest from buyers, which isn’t most likely going to be a problem,” ShayLe Stewart, DTN livestock analyst, wrote in Wednesday’s closing comments. “As the market waits for Friday’s Cattle on Feed and the midyear Cattle Inventory report, traders may trade cautiously throughout the market until the report’s findings are disclosed.”
The heat dome across the Corn Belt during pollination followed by a forecast of cooler weather had traders worried that yields could be lower than expected. The September contract was down 30 cents to $5.75, and the December contract was down 28 cents to $5.73 a bushel.
Kansas: Winter Livestock in Dodge City sold 1,812 head Wednesday. Compared to the previous auction, feeder steers 700-900 lbs. sold steady to $3 higher. Steers 500-700 lbs. sold steady to $2 lower. Steer calves 400-500 lbs. sold $20 higher. Feeder heifers 600-900 lbs. sold unevenly steady. Heifer calves 400-600 lbs. sold $3-5 higher. Benchmark steers averaging 779 lbs. sold between $162-164.50, averaging $163.88.
Missouri: Joplin Regional Stockyards in Carthage sold 9,551 head Monday. Compared to the last auction, feeder steers traded steady to $4 higher, with feeder heifers trading steady to $3 higher. Benchmark steers averaging 776 lbs. sold between $167-179.50 and averaged $171.05.
Nebraska: Tri-State Livestock in McCook sold 1,050 head Monday. As the last auction was several weeks ago, an accurate comparison wasn’t available. Demand was good with the selection of calves and feeders offered. Benchmark steers averaging 720 lbs. sold for $174.50.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 12,400 head Monday. Compared to the previous auction, feeder steers sold $4-7 lower. Feeder heifers traded unevenly steady. Steer and heifer calves were $3-6 lower. Benchmark steers averaging 776 lbs. sold between $162-173, averaging $169.04.
South Dakota: Sioux Falls Regional Livestock in Worthing sold 1,749 head Monday. Compared to the previous auction, feeder steers and heifers sold $2-5 lower. Steers weighing 650-700 lbs. sold with much lower undertones, and heifers weighing 650-750 lbs. sold with higher undertones this week. Benchmark steers averaging 781 lbs. sold between $178-181.50, averaging $180.94. — Charles Wallace, WLJ editor
