Cattle futures closed sharply lower Thursday with likely profit taking, month-end position squaring and technical wariness over the impact of steeper U.S. tariffs on Brazilian beef imports.
Toward the close, Live cattle futures were an average of $4.68 lower. Feeder Cattle futures were an average of $8.59 lower.
Negotiated cash fed cattle trade was light on moderate demand in Nebraska through Thursday afternoon, according to the Agricultural Marketing Service. There were some early dressed delivered prices $3 higher at $383/cwt. FOB live prices there last week were $242-$245.
Trade was limited on moderate demand in Kansas. Although too few to trend, there were some early FOB live sales at $235/cwt. Prices last week were $230-$232.
Elsewhere, trade was mostly inactive on moderate demand.
Last week, FOB live prices were $230-$232/cwt. in the Texas Panhandle and mostly $240 in the western Corn Belt where dressed delivered prices were $380.
Choice boxed beef cutout value was 67¢ lower Thursday afternoon at $361.32. Select was 46¢ higher at $341.37.
Grain and Soybean futures were mixed Thursday.
Toward the close and through away Jly contracts, Corn futures were fractionally higher to 2¢ higher. Kansas City Wheat futures were fractionally lower 4¢ higher. Soybean futures were 4¢ to 5¢ lower.
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Major U.S. financial indices closed lower Thursday, despite strong quarterly earnings for tech giants like Microsoft.
The Dow Jones Industrial Average closed 330 points lower. The S&P 500 closed 23 points lower. The NASDAQ was down 7 points.
Through mid-afternoon, West Texas Intermediate Crude Oil futures (CME) were 62¢ to 66¢ lower through the front six contracts.
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Reflecting on last week’s USDA Cattle and Cattle on Feed reports, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University notes the beef cow inventory of 28.65 million head was 1.5% less than two years earlier, when the previous mid-year report was published, but was 2.8% more than the beginning of this year.
“Historically, this would indicate some herd growth in the first half of the year but there is little other data to corroborate this estimate,” Peel says.
“Beef replacement heifers for July 1 were 3.7 million head, down 5.1% from two years ago. The comparison of July to January beef replacement heifers was about the same as two years ago and does not indicate heifer retention.”
Likewise, Matthew Diersen, risk and business management specialist at South Dakota State University points out heifers represented 38.1% of all cattle on Feed July 1.
“The mix has been hovering around 39% for several years,” Diersen says in the most recent issue of In the Cattle Markets. “The mix bottomed out at around 31% in mid-2015 during the last cattle expansion. The mix had been getting lower, especially last quarter when it reached 37.6%. An increase from April 1 to July 1 is consistent over time. The mix is the smallest it has been on July 1 since 2019 and would be the slightest indication that some expansion is being considered.”
Considering the July Cattle on Feed and the Cattle reports together, Peel says there is no indication of significant heifer retention.
“My feeling is that some movement towards herd rebuilding may be starting but is very slow and cautious,” Peel says. “It is possible, perhaps even likely, that the January 2025 beef cow herd will be the cyclical low, but the January 2026 inventory will likely be close to unchanged showing very little, if any, growth this year.”
You can hear more of Peel’s market insights here.