Cattle futures extended losses Wednesday, trading mostly limit-down, as traders hunt for a bottom to the emotionally driven break, tied to President Trumps goal of lowering domestic retail beef prices.
Toward the close, Live Cattle futures were an average of $7.20 lower. Feeder Cattle futures were an average of $9.19 lower.
Negotiated cash fed cattle trade ranged from light on moderate demand in the Southern Plains to moderate on good demand in the North through Wednesday afternoon, according to the Agricultural Marketing Service.
Early, FOB live prices were $3-$4/cwt. lower in the Texas Panhandle at $232 and $3-$5 lower in Kansas at $232. FOB live prices were unevenly steady in Nebraska at $230-$230.50 and $1-$2 lower in the western Corn Belt at mostly $228-$229. Dressed delivered prices were steady to $1 lower at $357-$360.
Choice boxed beef cutout value was 68¢ higher Wednesday afternoon at $378.26/cwt. Select was $1.00 lower at $360.25.
Grain and Soybean futures rebounded on Wednesday, helped along by China rolling back some tariffs on U.S. agricultural imports.
Toward the close and through Jly contracts, Corn futures were 3¢ to 4¢ higher. KC HRW Wheat futures were 3¢ to 4¢ higher. Soybean futures were 10¢ to 15¢ higher.
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Major U.S. financial indices closed higher on Wednesday, buoyed by a turnaround in tech stocks and increased speculation the Supreme Court will deem President Trump’s tariffs illegal.
The Dow Jones Industrial Average closed 225 points higher. The S&P 500 closed 24 points higher. The NASDAQ was up 151 points.
Though mid-afternoon, West Texas Intermediate Crude Oil futures (CME) were 68¢ to 93¢ lower through the front six contracts.
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While cattle market psychology may have shifted in recent weeks, market fundamentals remain mostly the same, says Will Secor, Extension Livestock Economist at the University of Georgia, in the latest issue of In the Cattle Markets.
“The supply side remains tight with limited opportunities to expand in the short run,” Secor explains. “Cull cows from the dairy sector may offset some of the reduction in beef cull cows on tighter dairy margins. However, this offset is partial. Additionally, dressed weight increases may be topping out. In September, year-over-year increases in cattle dressed weights ranged from 1.5-2.1%. In contrast, dressed weights in January saw year-over-year increases of around 3.2-5.3%. Lastly, changes in beef imports are limited and likely more complementary to existing beef supplies, as imports are often lean beef being blended for ground beef.”
On the other side of scale, Secor notes various data suggest domestic consumer beef demand remains strong.