Cattle futures finally rallied from their recent doldrums on Tuesday. There isn’t anything to suggest any driver other than technical correcting and potential bottom picking.
Live Cattle futures closed an average of $1.10 higher (80¢ to $1.42 higher).
Feeder Cattle futures closed an average of $1.76 higher (87¢ to $2.22 higher).
Choice boxed beef cutout value was $1.47 lower on Tuesday afternoon at $204.06/cwt. Select was 26¢ higher at $185.92.
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Major U.S. financial indices closed mixed on Tuesday. Support was reportedly tied to increasing optimism over the tax proposal.
The Dow Jones Industrial Average closed 118 points higher. The S&P 500 closed 4 points higher. The NASDAQ closed 12 points lower.
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Beef production this year was lowered slightly in the latest World Agricultural Supply and Demand Estimates (WASDE) released yesterday. The reduction came from the current pace of cattle slaughter and lighter carcass weights.
Total red meat and poultry production for this year was also projected lower on reduced beef and pork production.
Based on softer, recent prices, WASDE estimates were a touch lower for fed cattle prices in the fourth quarter ($116-$119/cwt.) and for the year ($121.42).
Price estimates for fed cattle in 2018: first quarter, $117-$123; second quarter, $112-$122; third quarter, $110-$120; 2018 annual, $113-$122.