Fundamentals appeared to return to Cattle futures trade Monday as prices gained back some of the recent losses.
Toward the close, Live Cattle futures were an average of $2.34 higher. Feeder Cattle futures were an average of $5.36 higher.
Negotiated cash fed cattle trade was inactive on light demand in all cattle feeding regions through Monday afternoon, according to the Agricultural Marketing Service.
Last week, FOB live prices were $2-$3 lower in the Texas Panhandle at $235-$236/cwt. in a light test, $1-$3 lower in Kansas at $235-$237 in a light test, $7 lower in Nebraska at $228-$232 and $5-$9 lower in the western Corn Belt at mostly $230. Dressed delivered prices were mainly $10-$12 lower at $358-$360.
The five-area direct weighted average FOB live fed steer price was $7.03 lower at $230.86. The weighted average dressed delivered fed steer price was $10.76 lower at $358.54.
Choice boxed beef cutout value was $1.12 higher Monday afternoon at $379.25/cwt. Select was $1.28 higher at $359.93.
Soybean futures gained again Monday, riding the coattails of last week’s announced trade framework between the United States and China. Toward the close and through Jly contracts, Soybean futures were 14¢ to 20¢ higher.
KC HRW Wheat futures were 8¢ to 13¢ higher with chatter about potential Chinese business.
Corn futures were 3¢ to 4¢ higher.
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Major U.S. financial indices closed mixed on Monday, with the most support from AI stocks.
The Dow Jones Industrial Average closed 226 points lower. The S&P 500 closed 11 points higher. The NASDAQ was up 109 points.
West Texas Intermediate Crude Oil futures (CME) closed unchanged to 22¢ higher through the front six contracts.
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Given extreme volatility in cattle markets the past couple of weeks, tied to political statement and proposals aimed at reducing domestic consumer retail beef prices, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University emphasizes the importance of remembering that underlying fundamentals remain unchanged.
“What is clear is that uncertainty and volatility from political comments and rhetoric have a very real negative impact on producers and consumers,” Peel says in his weekly market comments. He notes feeder cattle value declined $200-$300 per head in Oklahoma auctions last week.
“The federal government’s demonstrated willingness to meddle in cattle and beef markets and interfere with markets doing what they do so well likely means that the industry will continue to deal with debilitating uncertainty and volatility,” Peel says. “The most likely outcome is that it will keep cattle producers and lenders cautious and further delay the lengthy process of herd rebuilding, which already looks to extend nearly to the end of the decade.” He adds that the trajectory and price expectations for the next two to four years have not changed.