WLI

Cattle futures charged ahead Thursday, fueled by strong gains in cash fed cattle prices and the bullish Cattle inventory report (see below) released after trading the previous day.

Feeder Cattle futures closed an average of $3.90 higher ($3.21 higher at the back to $4.72 higher at the front).

Live Cattle futures closed an average of $2.08 higher.

Negotiated cash fed cattle trade was moderate on moderate demand in the Southern Plains through Thursday afternoon, according to the Agricultural Marketing Service. FOB live prices were mostly $3 higher at mostly $178/cwt.

Elsewhere, trade ranged from moderate on moderate demand to moderate on light demand.

So far this week, dressed delivered prices are $3 higher at $280.

Last week, FOB live prices were $175-$177 in Nebraska and $174-$177 in the western Corn Belt.

Choice boxed beef cutout value were 40¢ higher Thursday afternoon at $294.94/cwt. Select was 92¢ lower at $287.05/cwt.

Corn futures closed unchanged to 1¢ lower.

KC HRW Wheat futures closed mostly 1¢ lower.

Soybean futures closed mostly 12¢ to 19¢ lower.

Cattle futures bounced back Tuesday, perhaps with positioning ahead of Wednesday’s Cattle inventory report.

Feeder Cattle futures closed an average of $1.98 higher, except for 27¢ higher in the back contract.

Live Cattle futures closed an average of 80¢ higher, 52¢ to $1.27 higher.

Negotiated cash fed cattle trade ranged from mostly inactive on light demand to a standstill through Tuesday afternoon, according to the Agricultural Marketing Service.

Last week, FOB live prices were $175/cwt. in the Texas Panhandle, $174-$175 in Kansas (mostly $175), $175-$177 in Nebraska and $174-$177 in the western Corn Belt. Dressed delivered prices were at $277

Choice boxed beef cutout value (p.m.): $3.35 lower at $296.07/cwt. Select was $1.77 lower at $287.05/cwt.

Grain and soybean futures rallied Tuesday with apparent short covering.

Corn futures closed 6¢ to 8¢ higher through May ’25.

KC HRW Wheat futures closed 8¢ to 12¢ higher.

Soybean futures closed 12¢ to 24¢ higher.

Cattle futures started Monday’s session with follow-through support that faded as the day wore on amid likely profit taking and positioning ahead of Wednesday’s USDA Cattle inventory report. Although another year of beef cow contraction is widely anticipated, the degree will also depend on whether USDA makes any adjustments to prior-year figures.

Feeder Cattle futures closed an average of 94¢ lower (55¢ to $1.32 lower).

Live Cattle futures closed an average of 56¢ lower.

Negotiated cash fed cattle trade was at a standstill in all major cattle feeding regions through Monday afternoon, according to the Agricultural Marketing Service.

Last week, FOB live prices were $175/cwt. in the Texas Panhandle, $174-$175 in Kansas (mostly $175), $175-$177 in Nebraska and $174-$177 in the western Corn Belt. Dressed delivered prices were at $277.

The five-area direct weighted average FOB live steer price last week was $1.68 higher at $175.44/cwt. The five-area direct dressed delivered price was $2.98 higher at $276.87.

Choice boxed beef cutout value was $1.11 lower Monday afternoon at $299.42/cwt. Select was 31¢ lower at $288.82/cwt.

Turning to row crops, grain and soybean futures closed lower Monday with apparent concerns about China’s economy.

Soybean futures closed 1¢ to 15¢ lower through May ’25 and then mainly fractionally higher.

Corn futures closed 1¢ to 6¢ lower through Jly ’25 and then 1¢ to 4¢ higher.

KC HRW Wheat futures closed mostly 7¢ to 8¢ lower.

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Major U.S. financial indices closed higher Monday, led by bullish tech stocks.

The Dow Jones Industrial Average closed 224 points higher. The S&P 500 closed 36 points higher. The NASDAQ was up 172 points.

West Texas Intermediate Crude Oil futures (CME) closed 96¢ to $1.23 lower through the front six contracts.

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Besides offering a glimpse of the beef cow inventory, Wednesday’s USDA Cattle report offer opportunity to corroborate notions about how the monthly feedlot inventory has exceeded year-ago levels in the face of estimated reductions in the number of cattle available for placement.

Kenny Burdine, Extension livestock economist at the University of Kentucky notes earlier marketing due to dry conditions was partly the reason, along with increased imports of heavier feeder cattle from Mexico. He also points to the counter-cyclical increase in slaughter weights during the last couple of months last year.

“Cheaper feed in the fourth quarter was likely the driving factor, but this ultimately means that cattle were on feed for a longer period of time,” Burdine explains, in the latest issue of Cattle Market Notes Weekly. “This seems to be supported by increased estimates of cattle on feed over 90 and 120 days and also partially explains the higher feedlot inventories.”

Moreover, Burdine notes the high percentage of heifers on feed, explaining

“The number of heifers on feed (Jan. 1) was higher than the last quarter and higher than January of 2023. While heifers as a percent of on-feed inventory declined slightly in January, it remained just under 40%, and Burdine says that During expansionary times, the percentage of heifers on feed tends to be in the lower to middle of the 30% range. In sum, he says A number near 40% does not suggest that heifer retention is ongoing and continues to suggest that expansion is not immediately visible on the nearby horizon.”

Cattle futures continued higher Friday, buoyed by lighter carcass weights due to the weather, higher cash fed cattle prices and strong wholesale beef values.

Feeder Cattle futures closed an average of $1.62 higher. Week to week, they were up an average of $7.64.

Live Cattle futures closed an average of 94¢ higher. They were an average of $3.70 higher week to week.

Negotiated cash fed cattle trade ranged from slow on light demand to a standstill through Friday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.

For the week, FOB live prices were $1.50 higher in the Texas Panhandle at $175/cwt., $1-$2 higher in Kansas at $174-$175 (mostly $175), $2-$4 higher in Nebraska at $175-$177 and from $1 lower to $2 higher in the western Corn Belt at $174-$177. Dressed delivered prices were $3-$4 higher at $277.

Choice boxed beef cutout value was $1.85 higher Friday afternoon at $300.53/cwt. Select was $1.28 higher at $289.13/cwt. Week to week, Choice was $5.03 higher and Select was $6.08 higher.

Grain and soybean futures continued to chop in search of a low Friday.

Soybean futures closed 10¢ to 14¢ lower.

Corn futures closed 4¢ to 5¢ lower through Jly ’25.

KC HRW Wheat futures closed mostly 6¢ to 9¢ lower.

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Major U.S. financial indices closed narrowly mixed Friday.

The Dow Jones Industrial Average closed 60 points higher. The S&P 500 closed 3 points lower. The NASDAQ was down 55 points.

West Texas Intermediate Crude Oil futures (CME) closed 64¢ to 67¢ higher through the front six contracts.

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Estimated total cattle slaughter last week of 618,000 head was 1,000 head more than the previous week but 35,000 head fewer than the same week last year. Year-to-date estimated cattle slaughter of 2.3 million head was 204,000 head fewer (-8.1%) than the same period a year ago. Year-to-date estimated beef production of 1.96 billion pounds was 120.4 million pounds less (-5.8%).

As long as current consumer beef demand holds, beef prices should continue higher, according to Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments.

“It is not necessary for beef demand to increase to push prices higher. As long as demand stays steady then one would expect beef prices to increase as beef production declines with the number of cattle moving through the system,” Griffith says. “Consumers are currently focused on end meats, but it will not be long before retailers shift their focus toward middle meats.”

Griffith also notes, “It seems there has been a shift in consumer preferences with the wide Choice Select spread, and the spread will widen further.”

Negotiated cash fed cattle prices bounced higher Thursday.

FOB live prices were $1.50 higher in the Texas Panhandle at $175/cwt., $2 higher in Kansas at $175, $2-$4 higher in Nebraska at $175-$177 and unevenly steady in the western Corn Belt at $174-$176. Dressed delivered prices $3-$4 higher in Nebraska at $277. Prices in the western Corn Belt last week were $273-$274.

Choice boxed beef cutout value was 82¢ lower Thursday afternoon at $298.68/cwt. Select was 61¢ higher at $287.85/cwt.

Stronger cash fed cattle prices and strong country demand for calves and feeder cattle helped push Cattle futures higher.

Feeder Cattle futures closed an average of $3.54 higher ($2.72 higher at the back to $4.40 higher in spot Mar), not counting Jan going off the board 20¢ higher.

Live Cattle futures closed an average of $1.53 higher (60¢ higher at the back to $2.37 higher in the front contract).

Turning to row crops, traders took some of the South American weather premium back out of Soybean futures, which closed mostly 10¢ to 17¢ lower.

Corn futures closed mostly 1¢ lower.

KC HRW Wheat futures closed 1¢ to 11¢ higher through May ’25 and then 2¢ lower.

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Major U.S. financial indices closed higher Thursday, supported by more bullish domestic GDP than expected. Real gross domestic product (GDP) increased at an annual rate of 3.3% in the fourth quarter of 2023, according to the “advance” estimate released by the Bureau of Economic Analysis. Real GDP increased 4.9% in the third quarter.

The Dow Jones Industrial Average closed 242 points higher. The S&P 500 closed 25 points higher. The NASDAQ was up 28 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.90 to $2.27 higher through the front six contracts.

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Food price growth slowed last year with less economy-wide inflationary pressure, fewer supply chain issues, and lower wholesale food prices, according to USDA’s Economic Research Service (ERS).

Food-at-home prices increased by 5.0% in 2023, much lower than the growth rate of 11.4% in 2022 but still double the historical annual average growth of 2.5% from 2003 to 2022, according to ERS.

Beef and veal prices rose 3.6% last year, more slowly than their historical averages. Pork prices declined 1.2%.

For broader perspective, the steepest price increases last year were 9.0% for fats and oils, 8.7% for sugar and sweets and 8.4% for cereal and bakery products.

ERS researchers project overall food-at-home prices will decrease 0.4% this year.