Cash fed cattle trade started out $1 lower yesterday, beginning with the weekly Fed Cattle Exchange auction. Only one lot (54 head) sold out of the 1,063 head offered, at a weighted average price of $116/cwt. for delivery at 1-9 days. The weighted average there last week was $117.68.
Country trade started out mostly $1 less than last week too, at $116, but by the end of the day, sales were reported up to $118.
Cattle futures followed a similar path, except they started the session with support that faded by mid-day before bouncing to close with mostly triple-digit gains.
Except for 60¢ and 55¢ higher in the back two contracts, Live Cattle futures closed an average of $1.45 higher ($1.07 to $1.80 higher).
Feeder Cattle futures closed an average of $1.13 higher (85¢ to $1.45 higher).
Choice boxed beef cutout value was 35¢ lower Wednesday afternoon at $205.06/cwt. Select was 87¢ lower at $197.42.
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Major U.S. financial indices closed mostly higher on Wednesday as a bump higher in Apple (quarterly earnings blowing past expectations) helped lift the Dow to a record-high close over 22000 for the first time.
The Dow Jones Industrial Average closed up 52 points. The S&P 500 closed 1 point higher. The NASDAQ closed fractionally lower.
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Keeping in mind how depressed prices were last fall, the Livestock Marketing Information Center (LMIC) forecasts yearling prices at or above a year ago for the balance of 2017.
As for calf prices, LMIC analysts say, “Current quarter (July-September) calf prices are likely to be unchanged to higher, compared to 2016’s. In 2017’s fourth quarter, Southern Plains calf prices (500-600 lbs. steers) are currently forecast to be $8-$12/cwt. above 2016’s.”
Heading into next year, LMIC notes increasing cattle numbers will likely pressure fed cattle prices. The degree of pressure will have plenty to do with domestic and international demand.
“For planning purposes, look for some erosion in calf and yearling prices in 2018 compared to 2017’s,” LMIC analysts say, in the most recent Livestock Monitor. “Currently, LMIC is forecasting the annual average fed steer price in 2018 will be 2% to 6% below 2017’s. The 2017, U.S. calf crop was bigger than 2016’s, and 2018’s will increase, again. Feedlots and backgrounders could face higher feedstuff costs in 2018, which may provide some additional headwind to prices.”