WLI

Cattle futures extended gains Wednesday with help from higher cash fed cattle prices, albeit in limited trade.

Feeder Cattle futures closed an average of 53¢ higher.

Live Cattle futures closed an average of 61¢ higher.

Negotiated cash fed cattle trade was moderate on moderate demand in Kansas through Wednesday afternoon, according to the Agricultural Marketing Service. FOB live prices were $1 higher at $174/cwt.

Elsewhere, trade was mostly inactive on light demand. FOB live prices last week were $173.50/cwt. in the Texas Panhandle, $173 in Nebraska and $175 in the western Corn Belt. Dressed delivered prices were $273-$274.

Choice boxed beef cutout value was $2.16 lower Wednesday afternoon at $299.50/cwt. Select was $1.14 lower at $287.24/cwt.

Corn futures closed 4¢ to 5¢ higher.

KC HRW Wheat futures closed mostly 8¢ to 9¢ higher.

Soybean futures closed mostly 1¢ higher after Sep ’24.

******************************

Major U.S. financial indices closed mixed again Wednesday after early support from tech stocks.

The Dow Jones Industrial Average closed 99 points lower. The S&P 500 closed 3 points higher. The NASDAQ was up 55 points.

West Texas Intermediate Crude Oil futures (CME) closed 58¢ to 72¢ higher through the front six contracts.

******************************

Beef supplies in cold storage continue to be less year over year, according to the latest reportfrom USDA.

Total pounds of beef in freezers Dec. 31 were 6% more than the previous month but 11% less than the same time last year.

Similarly, frozen pork supplies were up 3% from the previous month but down 6% from the prior year.

Total red meat supplies in freezers were 4% more than the previous month but 9% less than a year earlier.

On the other hand, total frozen poultry supplies were up 4% from the previous month and up slightly from a year earlier.

Cattle futures bounced higher Tuesday with support from stronger wholesale beef values. Feeder Cattle were also buoyed by hefty cash trade.

Feeder Cattle futures closed an average of $1.87 higher ($1.47 to $2.37 higher).

Live Cattle futures closed an average of 63¢ higher.

Choice boxed beef cutout value was $2.99 higher Tuesday afternoon at 301.66/cwt., the highest level since the first part of November. Select was $1.80 higher at $288.38/cwt.

Negotiated cash fed cattle trade was at a standstill through Tuesday afternoon, according to the Agricultural Marketing Service.

FOB live prices last week were $173.50/cwt. in the Texas Panhandle, $173 in Kansas $173 in Nebraska and $175 in the western Corn Belt. Dressed delivered prices were $273-$274.

Soybean futures closed mostly 8¢ to 15¢ higher through Sep ’25 and then 6¢ higher with chatter about softer South American production.

Corn futures closed fractionally higher to 1¢ higher.

KC HRW Wheat futures closed mostly 4¢ to 5¢ higher.

******************************

Major U.S. financial indices closed mixed Tuesday on mixed earnings reports.

The Dow Jones Industrial Average closed 96 points lower. The S&P 500 closed 14 points higher. The NASDAQ was up 65 points.

West Texas Intermediate Crude Oil futures (CME) closed 36¢ to 39¢ lower through the front six contracts.

******************************

USDA will release the much-anticipated semiannual Cattle report next Wednesday with estimates of the cattle inventory. In the meantime, other data continues pointing to the lack of her rebuilding so far.

For one, the ratio of beef cows and heifers in last year’s slaughter mix was near record high, according to analysts with USDA Economic Research Service (ERS), in the January Livestock, Dairy and Poultry Outlook. Specifically, ERS analysts say beef cows and heifers comprised 42.1% of cattle slaughter last year, only slightly less than the previous year’s record 42.3% (since the data series began in 1986).

“In 2023, all classes of slaughter were down from the prior year. However, the proportion of heifers and cows in the slaughter mix was higher than anticipated a year ago,” say ERS analysts. “The expectation was that as drought from 2020–22 largely receded, pasture conditions improved, and calf prices rose, producers would be more willing to retain heifers and cows to maintain or expand their herds.”

As well, heifers comprised 39.4% of the cattle on feed, Jan.1, according to the most recent Cattle on Feed report. That was about the same as the previous year’s historically high percentage. In raw numbers, however, there were 4.74 million heifers on feed Jan. 1, compared to 4.65 million head the previous year.

Cattle futures faded early pressure to close narrowly mixed Monday. Despite the neutral Cattle on Feed report, reasons for skittishness included anemic cash fed cattle trade at static prices.

Feeder Cattle futures closed from an average of 44¢ lower in the front three contracts to an average of 24¢ higher.

Live Cattle futures closed from an average of 27¢ lower in the front five contracts to an average of 31¢ higher.

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

FOB live prices last week were $1.50 higher in the Texas Panhandle at $173.50/cwt., $1 higher in Kansas at $173, and steady in the North at $173 in Nebraska and $175 in the western Corn Belt. Dressed delivered prices were unevenly steady in the Nebraska at $273-$274 and $1-$2 lower in the western Corn Belt at $273-$274.

Last week’s weighted average five-area direct FOB live steer price was 29¢ higher at $173.76/cwt. The weighted average dressed delivered steers price was 19¢ higher at $273.89.

Choice boxed beef cutout value (p.m.): $3.17 higher at 298.67/cwt. Select was $3.53 higher at $286.58/cwt.

Soybean futures closed mostly 6¢ to 7¢ higher.

Corn futures closed fractionally higher to 1¢ higher.

KC HRW Wheat futures closed mostly fractionally higher.

******************************

Major U.S. financial indices closed higher Monday on follow-through support.

The Dow Jones Industrial Average closed 138 points higher. The S&P 500 closed 10 points higher. The NASDAQ was up 49 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.56 to $1.78 higher through the front six contracts.

******************************

Major U.S. financial indices closed higher Monday on follow-through support.

The Dow Jones Industrial Average closed 395 points higher. The S&P 500 closed 58 points higher. The NASDAQ was up 255 points.

West Texas Intermediate Crude Oil futures (CME) closed 67¢ to 71¢ lower through the front six contracts.

******************************

Between year-end holidays and widespread severe winter weather in the new year, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University says it will likely take another week or two to sort out both beef demand and supply conditions. That assumes no further disruptions.

Peel notes in his weekly market comments boxed beef markets decreased the first week of January as retailers assessed holiday markets and sorted out post-holiday beef pipelines. Suspended packer production, tied to the weather pushed wholesale beef prices higher.

As the new year began, analysts with the Livestock Marketing Information Center (LMIC) explain prices for wholesale 50% fresh lean beef trimmings were $144/cwt. less (-72%) than during the summer.

“Wholesale 50% lean beef trimming prices dropped below the five-year average at the end of October after soaring most of the year,” say LMIC analysts, in the latest Livestock Monitor. “For the last nine weeks, these prices have been below the five-year average by 8% to 25%. This level of decline is somewhat concerning given November and December fed cattle slaughter was down 4% from 2022, indicating significantly smaller supplies.”

Negotiated cash fed cattle trade on Friday ranged from a standstill in the Southern Plains to slow on light demand in the North, but with too few transactions to trend, according to the Agricultural Marketing Service. The previous week, FOB live prices were $172/cwt. in the Southern Plains, $173 in Nebraska and $175 in the western Corn Belt. Dressed delivered prices were $272-$275 in Nebraska and $275 in the western Corn Belt.

Choice boxed beef cutout value was 79¢ lower Friday afternoon at 295.50/cwt. Select was 71¢ lower at $283.05/cwt. Week to week, Choice was up $6.24 and Select was $11.20 higher.

Cattle futures mainly paddled in place Friday ahead of the monthly Cattle on Feed report (see below) and awaiting the week’s cash fed cattle direction.

Feeder Cattle futures closed narrowly mixed, from an average of 35¢ lower in the front five contracts to an average of 24¢ higher. They were an average of $4.06 higher week to week.

Live Cattle futures closed narrowly mixed, from an average of 24¢ lower to an average of 14¢ higher. Week to week, they were up an average of $2.48.

Corn futures closed narrowly mixed, from 1¢ lower to 1¢ higher.

KC HRW Wheat futures closed mostly 2¢ to 4¢ higher.

Soybean futures closed fractionally lower to 1¢ lower through Mar ’25 and then mostly fractionally higher.

******************************

Major U.S. financial indices surged higher Friday, underpinned by bullish consumer data. Consumer sentiment was 13.1% higher month to month in January and reached the highest level since July 2021, according to the University of Michigan Surveys of Consumers.

The Dow Jones Industrial Average closed 395 points higher. The S&P 500 closed 58 points higher. The NASDAQ was up 255 points.

West Texas Intermediate Crude Oil futures (CME) closed 67¢ to 71¢ lower through the front six contracts.

******************************

Markets should view Friday’s monthly Cattle on Feed report as neutral, coming in about dead even with pre-report estimates.

Feedlots with 1,000 head or more capacity placed 1.7 million head in December, which was 80,000 head fewer (-4.5%) than the prior year.

In terms of placement weights, 50% went on feed weighing 699 pounds or less, 38% weighing 700-899 pounds and 12% weighing 900 pounds or more.

Marketings in December of 1.7 million head were 16,000 head fewer (-0.9%) than a year earlier.

Cattle on feed Jan. 1 of 11.9 million head were 248,000 more (+2.1%) than the same time last year.

Cattle futures stretched higher Thursday, led by Feeder Cattle. Recently higher wholesale beef prices and growing prospects of steady to higher cash fed cattle prices this week added support. There was also likely some positioning ahead of the monthly Cattle on Feed report scheduled for release Friday. Analyst estimates ahead of the report peg December placements about 4% lower year over year, December marketings about 0.5% less and the Jan. 1 feedlot inventory about 2% higher.

Feeder Cattle futures closed an average of $2.21 higher ($1.65 to $2.77 higher).

Live Cattle futures closed an average of $1.41 higher (1.00 to $2.02 higher).

Negotiated cash fed cattle trade ranged from inactive on light demand to a standstill through Thursday afternoon, according to the Agricultural Marketing Service. Last week, FOB live prices were $172/cwt. in the Southern Plains, $173 in Nebraska and $175 in the western Corn Belt. Dressed delivered prices were $272-$275 in Nebraska and $275 in the western Corn Belt.

Choice boxed beef cutout value was $2.16 lower Thursday afternoon at 296.29/cwt. Select was 74¢ higher at $283.76/cwt.

Grain and Soybean futures firmed on apparently oversold conditions and positive outside markets.

Soybean futures closed 1¢ to 7¢ higher through Mar ’25 and then 1¢ to 5¢ lower.

Corn futures closed mostly 1¢ higher through Jly ’25 and then mostly 1¢ to 2¢ lower.

KC HRW Wheat futures closed mostly 7¢ to 9¢ higher.

******************************

Major U.S. financial indices closed higher Thursday, led tech stocks. Pressure early in the day came from indicators of a tighter labor market.  

Seasonally adjusted weekly initial unemployment insurance claims were 187,000 for the week ending Jan. 13, according to the U.S. Department of Labor. That was less than the trade expected, pointing to further tightness in the labor market.

The Dow Jones Industrial Average closed 201 points higher. The S&P 500 closed 41 points higher. The NASDAQ was up 200 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.16 to $1.52 higher through the front six contracts.