Cash fed cattle prices took a solid step higher in late week trade…Equity markets settled narrowly mixed ahead of the long weekend…Coming up on your Cattle Current Market Update with Wes Ishmael.
Cattle feeders were rewarded for their marketing patience on Friday. Cash fed cattle prices were $3-$4 higher than the previous week on a live basis at $129-$130/cwt. Dressed trade was $5 higher at $205.
Although higher week to week, Cattle futures closed narrowly mixed on Friday as traders positioned ahead of the weekend, extended to three days for futures and equity markets by President’s Day.
After 82¢ higher in spot Feb, Live Cattle futures closed narrowly mixed, (12¢ lower to 40¢ higher).
Feeder Cattle futures closed narrowly mixed, 10¢ lower to 10¢ higher across the front half of the Board and then 15¢ to 55¢ higher.
Wholesale beef values continue to offer optimism. Choice boxed beef cutout value was 84¢ higher on Friday afternoon at $209.88/cwt. Select was 2¢ lower at $205.12.
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Major U.S. financial indices drifted to a narrowly mixed close on Friday, with investors apparently playing defense ahead of the long holiday weekend.
Support included 9.7% more housing starts in January than the prior month and 7.3% more than the previous year, according to the federal government’s Monthly New Residential Construction report.
The Dow Jones Industrial Average closed 19 points higher. The S&P 500 closed 1 point higher. The NASDAQ closed 16 points lower.
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“Light boxed beef movement has allowed packers to keep wholesale beef prices elevated the first six weeks of the year, but a more seasonal tone came into the Thursday and Friday market,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “February beef demand is always weak relative to most other months and that weakness is beginning to show up in wholesale beef prices.”
However, Griffith also notes that both Choice and Select cutout values remain above $200/cwt.
“This is important from the standpoint that the $200 mark was a major resistance point prior to the trough of cattle inventory in the current cattle cycle,” Griffith explains. “Since that resistance was broken, the same price point has provided significant support. Choice and Select cutouts could dip below the invisible support line, but the risk of a total collapse is small…”