We are in the peak of summer right now in the cattle market, with video sales running hot and seasonal corrections beginning to take place.
Live cattle futures were higher over the week, with the August contract up about $2 to $176.90 and the October contract up about $3 to $180.10.
“CME cattle futures as of late are trading an ‘open lower then rally’ pattern as the market hangs out near life-of-contract highs,” wrote Cassie Fish, market analyst, in The Beef on Tuesday.
Cash trade through Thursday was slim, with under 15,000 head sold. Live steers sold from $178-186, averaging $181.81. Dressed steers sold from $287-295, averaging $290.82.
“There is an old rule of thumb that you can’t break the market when you don’t own enough inventory,” Fish said. “This is a tough task given that fed cattle supplies are down about 700k head this year compared to last. That’s a bunch coming off of big numbers.”
Cash trade through the week ending July 9 totaled 75,381 head. Live steers averaged $182.23, and dressed steers averaged $289.87.
The national weekly direct beef type price distribution for the week of June 26 – July 3 was the following on a live basis:
• Negotiated purchases: $182.22.
• Formula net purchases: $184.02.
• Forward contract net purchases: $179.46.
• Negotiated grid net purchases: $186.50.
On a dressed basis:
• Negotiated purchases: $289.78.
• Formula net purchases: $293.30.
• Forward contract net purchases: $267.04.
• Negotiated grid net purchases: $297.85.
Slaughter through Thursday totaled about 504,000 head, compared to 336,000 head a week earlier during the holiday-shortened week. Projected slaughter for a week earlier is 539,000 head. Actual slaughter for the week ending July 1 was 650,573 head. The average dressed steer weight was 884 lbs., up 1 lb. from the prior week.
Boxed beef prices nosedived over the week, with the Choice cutout down about $13 to $306.91 and the Select cutout down $9 to $280.18.
“Wholesale beef prices are correcting to a summer low, which generally occurs in late July,” Fish said. “This summer break in boxed beef values is highly seasonal and healthy.”
Feeder cattle
Feeder cattle futures were up about $2 for each contract, with the August contract at $245 and the September contract at $247.32.
The CME Feeder Cattle Index gained over $9 to close at $239.69.
Corn futures found some movement higher, with the July contract up about 30 cents to $5.93 and the September contract down a few cents to $4.93.
“Feeder cattle sales are hot markets right now and the only softness that I’ve seen has been on unweaned calves selling at sale barns as buyers are more interested in calves/feeders that are going to undergo less stress,” wrote ShayLe Stewart, DTN livestock analyst, in her Wednesday closing comments.
Kansas: Winter Livestock in Dodge City sold 682 head on Wednesday. Compared to a week earlier, there were not enough cattle for a market test, but a higher trend was noted. Benchmark steers averaging 816 lbs. sold between $236.50-250, averaging $242.87.
Missouri: Joplin Regional Stockyards in Carthage, MO, sold 13,000 head on Monday. Compared to the last sale two weeks earlier, feeder steers sold $3-10 higher and feeder heifers sold $6-9 higher. Benchmark steers averaging 765 lbs. sold from $232-245, averaging $240.50.
Nebraska: Bassett Livestock in Bassett sold 6,980 head Wednesday. Compared to the last auction, steer calves 550- 600 lbs. traded $8 to as much as $30 higher, 650 lbs. steers traded $15 higher and 700 and 850 lbs. traded $10-12 higher. Heifer offerings 550 lbs. traded $11 higher, while 700 and 800 lbs. heifers traded $17- 23 higher. Benchmark steers averaging 720 lbs. sold between $276-281 and averaged $ 279.44.
New Mexico: Roswell Livestock in Roswell sold 1,337 head Tuesday. Compared to the last auction, steer calves 400-450 lbs. were $6 higher, while 450-500 lbs. sold $17 higher, and 500-600 lbs. sold $5-10 higher. Feeder steers 600-650 lbs. sold $18 higher, while 800-850 lbs. were $2 higher. Heifer calves 400-500 lbs. were sharply higher. There were not enough sales of feeder heifers for a comparison. Benchmark steers averaging 770 lbs. sold between $191-232, averaging $223.32.
Oklahoma: Oklahoma National Stockyards in Oklahoma City sold 6,900 head on Monday. Compared to the last test two weeks earlier, feeder steers sold $3-5 higher and feeder heifers sold $5-10 higher. Steer calves sold $5-10 higher, and heifer calves sold $15-20 higher. Benchmark steers averaging 737 lbs. sold from $239-250, averaging $245.28.
South Dakota: Sioux Falls Regional Cattle Auction in Worthing sold 1,848 head on Monday. Compared to two weeks earlier, feeder steers sold $5-10 higher, except 800-850 lbs. sold $3-7 lower. Feeder heifers sold $4-8 higher, but under 650 lbs. sold much softer. Benchmark steers averaging 816 lbs. sold from $235-243, averaging $239.48. — Anna Miller, WLJ managing editor
