In late trade on Friday, negotiated cash fed cattle trade ended up mostly $4 lower at $122/cwt. in the Southern Plains and Nebraska and at $118-$126 in the western Corn Belt. Dressed trade was steady to $5 lower in Nebraska at $189-$195; $3-$7 less in the western Corn Belt at $188-$193. Live trade in Colorado was mixed at $119-$122.
That news helped pressure Cattle futures, first a little and then a lot on Monday. Perhaps there was also some sense that wholesale beef values are running out steam sooner than later. The gap between spot Live Cattle and last week’s cash trade remains huge at $17 or so.
Live Cattle futures closed an average of $2.00 lower ($1.12 to $3.00 lower).
Feeder Cattle futures closed an average of $2.66 lower ($1.05-$3.52 lower).
Choice boxed beef cutout value was $1.15 higher Monday afternoon at $232.12/cwt. Select was 43¢ higher at $209.12. That was with fairly good demand and heavy offerings, according to the Agricultural Marketing Service.
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Major U.S. financial indices edged higher on Monday, amid chatter about trade tensions between the U.S. and China easing a bit.
The Dow Jones Industrial Average closed 68 points higher. The S&P 500 closed 2 points higher. The NASDAQ closed 8 point higher.
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“Beef exports continue to support cattle and beef markets with six strong major markets, plus a number of smaller markets, including lots of potential for China to be a much bigger market for U.S. beef over time,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments.
The six major markets account for 86.5% of U.S. beef exports so far this year. In order of market size, those nations are: Japan, South Korea, Mexico, Hong Kong, Canada and Taiwan.
“China is currently the number 12 beef export market for the U.S. and has accounted for less than 1% of total beef exports since exports to China resumed in June, 2017,” Peel says. “Despite the slow pace of exports to China thus far, there is tremendous potential for China to be a very significant beef export market for the U.S. Despite relatively low per capita beef consumption, China is the second largest beef consuming nation in the world, behind the U.S.”
First-quarter U.S. beef exports this year were 9% more than last year for volume and 19% more for value at $1.92 billion, according to the most recent data released by USDA and compiled by the U.S. Meat Export Federation. Beef export value averaged $315.67 per head of fed slaughter in the first quarter, up 18% year over year.