WLI

Feeder Cattle futures maintained upward momentum as Corn futures continued to decline.

Feeder Cattle futures closed an average of $1.32 higher.

Live Cattle futures closed an average of 75¢ higher through Feb ‘24 (32¢ to $1.37 higher) and then unchanged to an average of 48¢ lower.

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

So far this week, live sales in Kansas are $2 lower at $178/cwt.

Last week, live prices were $180/cwt. in the Southern Plains $182-$185 in Nebraska and $184-$185 in the western Corn Belt. Dressed prices were $290.

Choice boxed beef cutout value was $1.33 lower Wednesday afternoon at $327.90/cwt. Select was $1.75 lower at $296.68/cwt.

More rain forecast for the Corn Belt took grain and Soybean futures lower for the second consecutive session.

Corn futures closed 20¢ to 33¢ lower through Jly ‘24 and then 3¢ to 10¢ lower.

Soybean futures closed 28¢ to 44¢ lower through Jan ‘24 and then mostly 22¢ to 24¢ lower.

KC HRW Wheat closed 18¢ to 33¢ lower. 

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Major U.S. financial indices closed mixed Wednesday with pressure the Fed emphasizing more future interest rate hikes are likely in the picture.

The Dow Jones Industrial Average closed 33 points lower. The S&P 500 closed 1 point lower. The NASDAQ was up 36 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.61 to $1.86 higher through the front six contracts.

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Many meat and food item prices continue to increase but at a more moderate pace than last year, according to the latest Food Price Outlook from USDA’s Economic Research Service.

For instance, food at home prices were 0.1% higher month to month in May and 5.8% higher year over year. Year-to-date prices were 4.7% more than the same time last year when food at home prices were 11.4% more year over year.

More specifically, beef and veal prices increased 1.5% month to month in May and 1.0% year over year. Year-to-date prices were 0.1% less than the same time last year when prices were 5.3% higher year over year.

“The Choice beef price (May) topped $8.08 per pound while the all-fresh beef retail price exceeded $7.50 per pound,” says Andrew P. Griffith, agricultural economist at the University of Tennessee in his weekly market comments. “The Choice beef price is a historic high and represents a $0.23 per pound increase from April. The all-fresh beef retail price for May was $0.18 per pound higher than April and the third highest monthly price on record and the highest it has been since November 2021.”

By way of contrast, pork prices were 0.1% higher month to month but 2.9% lower year over year. Year-to-date, pork prices were down 1.9%. Poultry prices were 0.2% higher month to month and 2.1% higher year over year. Year-to-date poultry prices were up 2.2%.

Cattle futures rallied Tuesday, buoyed by declining Corn futures.

Feeder Cattle futures closed an average of $4.02 higher.

Live Cattle futures closed an average of $1.55 higher ($1.22 to $2.05 higher).

Corn futures took a sharp step lower, pressured by more rain forecast in the Corn Belt and despite deteriorating crop conditions displayed in the previous day’s weekly Crop Progress report. Keep in mind Acreage and Grain Stocks reports out Friday.

Corn futures closed mostly 15¢ to 27¢ lower.

Soybean futures closed 20¢ to 29¢ lower through Sep ‘24 and then mostly 17¢ lower.

KC HRW Wheat closed 20¢ to 28¢ lower.

Negotiated cash fed cattle trade ranged from light on light demand in the Southern Plains to mostly inactive on very light demand through Tuesday afternoon, according to the Agricultural Marketing Service.

Although too few to trend, there were a few live sales in Kansas at $178/cwt.

Last week, live prices were $180 in the Southern Plains $182-$185 in Nebraska and $184-$185 in the western Corn Belt. Dressed prices were $290.

Choice boxed beef cutout value was $3.81 lower Tuesday afternoon at $329.23/cwt. Select was $1.24 lower at $298.43/cwt.

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Major U.S. financial indices rose Tuesday, supported by positive economic news including an unexpected May increase of 1.7% for new manufactured durable goods orders. Consumer Confidence in June was also significantly higher.

The Conference Board Consumer Confidence Index® increased to 109.7 in June, up from 102.5 in May.

“Consumer confidence improved in June to its highest level since January 2022, reflecting improved current conditions and a pop in expectations,” says Dana Peterson, Chief Economist at The Conference Board. “Greater confidence was most evident among consumers under age 35, and consumers earning incomes over $35,000. Nonetheless, the expectations gauge continued to signal consumers anticipating a recession at some point over the next 6 to 12 months.”

The Dow Jones Industrial Average closed 212 points higher. The S&P 500 closed 49 points higher. The NASDAQ was up 219 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.29 to $1.67 lower through the front six contracts.

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Fed cattle supplies are the snuggest in three years, says Stephen Koontz, agricultural economist at Colorado State University, reflecting on Friday’s monthly Cattle on Feed report.

In the latest In the Cattle Markets, Koontz notes cattle on feed more than 150 days were less than the previous month and the prior three years, the same for cattle on feed for 90 days or more.

“Cattle on feed inventories continue to tighten from the peaks in 2022,” Koontz says. “The beginning of June saw an inventory of 11.552 million, roughly even with the beginning of June 2018. And there will be more and more of this to come with the level of heifer and beef cow slaughter. Beef cow slaughter remains down considerably from the prior year, but my assessment is that the industry is finally showing a neutral position and not liquidating nor rebuilding.”

Koontz also points to evidence of continued strong beef demand illustrated by the muted reaction of Live Cattle futures to the Cattle on Feed report, which indicated feedlot placements were about 3% more than expected.

“The boxed beef composite value has rallied to almost $340/cwt., whereas it spent all of 2022 below $295 and much of that year between $255-$275,” Koontz explains. “There is clearly strong beef demand supporting the market. We also see this in a seasonally strong Choice-Select spread.”

Although Friday’s Cattle on Feed report seemed to bring pressure early in the session, the reaction faded quickly as the day progressed in Cattle futures amid light trade.

Feeder Cattle futures closed an average of 61¢ higher, except for an average of 17¢ lower in the front three contracts.

Live Cattle futures closed narrowly mixed, from an average of 29¢ lower to an average of 13¢ higher.

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

Last week, live prices were $180/cwt. in the Southern Plains, $182-$185 in Nebraska and $184-$185 in the western Corn Belt. Dressed prices were $290.

The weighted average five-area direct fed steer price last week was $2.35 lower on a live basis at $182.57/cwt. The average fed steer price in the beef was $6.26 lower at $289.81.

Choice boxed beef cutout value was 97¢ lower Monday afternoon at $333.04/cwt. Select was 29¢ lower at $299.67/cwt.

Grain and Soybean futures closed mostly higher Monday, balancing weekend rains across much of the Corn Belt with geopolitical tensions in Russia.

Corn futures closed mostly 1¢ to 5¢ higher, except for mostly fractionally mixed from near Sep through near May.

Soybean futures closed 12¢ to 26¢ higher through Aug ‘24 and then mostly 9¢ to 12¢ higher. 

KC HRW Wheat closed mostly 5¢ higher.

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Major U.S. financial indices softened Monday with most pressure from tech stocks.

The Dow Jones Industrial Average closed 12 points lower. The S&P 500 closed 19 points lower. The NASDAQ was down 156 points.

West Texas Intermediate Crude Oil futures (CME) closed 21¢ to 27¢ higher through the front six contracts.

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Frozen beef stocks continued to decline last month, according to the latest USDA Cold Storage report. Beef in cold storage May 31 was 6% less than the previous month and 20% less than a year earlier.

Frozen pork supplies were 7% less than the previous month and down 4% year over year.

Total red meat supplies in freezers were 7% less than the previous month and 11% less than the previous year.

Total frozen poultry supplies were up 2% from the previous month and 9% higher year over year.

Weather forecasts continued to whipsaw grain markets on Friday with Corn and Soybean futures closing sharply lower on the wet weekend outlook for the Corn Belt, as well as overbought conditions.

Corn futures closed mostly 22¢ to 32¢ lower.

Soybean futures closed 18¢ to 29¢ lower through Jly ‘24 (except for 6¢ and 14¢ lower in the front two contracts) and then mostly 6¢ to 8¢ lower.

KC HRW Wheat closed mostly 10¢ to 18¢ lower.

Feeder Cattle futures surged an average of $2.80 higher Friday ($2.20 to $3.27 higher) as Corn futures slid lower.

Live Cattle futures tread water with pressure from the week’s softer cash trade and lower wholesale beef prices. They closed an average of 17¢ higher, except for an average of 23¢ lower in the front three contracts.

Negotiated cash fed cattle trade was inactive on light demand in all regions through Friday afternoon, with too few transactions to trend in any region, according to the Agricultural Marketing Service.

For the week, live prices were $2 lower in the Southern Plains at $180/cwt., $3-$4 lower in Nebraska at $182-$185 and $2-$3 lower in the western Corn Belt at $184-$185. Dressed prices were $6 lower in Nebraska at $290 and $6-$10 lower in the western Corn Belt at $290.

Choice boxed beef cutout value was 46¢ lower Friday afternoon at $334.01/cwt. Select was $3.84 lower at $299.96/cwt. The Choice Select spread was the highest since last October at $34.05.

Estimated total cattle slaughter last week of 649,000 head was 15,000 head more than the previous week, but 16,000 head fewer than the same week last year. Year-to-date estimated total cattle slaughter of 15.6. million head was 587,000 head less (-3.6%) that the same time last year. Year-to-date estimated beef production of 12.8 billion pounds was 638 million pounds less (-4.7%).

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Major U.S. financial indices slid Friday as investors appeared more concerned about domestic and global economic growth.

The Dow Jones Industrial Average closed 219 points lower. The S&P 500 closed 33 points lower. The NASDAQ was down 138 points.

West Texas Intermediate Crude Oil futures (CME) closed 17¢ to 35¢ lower through the front six contracts.

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Although bullish supply fundamentals remain, markets could view Friday’s monthly Cattle on Feed report as slightly bearish with May placements about 3% more than pre-report estimates. Placements in May of 1.9 million head were 86,000 more (+4.6%) year over year. That’s for feedlots with 1,000 head or more capacity.

In terms of placement weights, 34% went on feed weighing 699 lbs. or less, 51% weighing 700-899 lbs. and 15% weighing 900 lbs. or more.

Marketing in May of 1.9 million head were 1.7% more than last year, about even with expectations.

Cattle on feed June 1 of 11.5 million head were 2.9% less than the previous year. That was 0.5% more than estimates ahead of the report.

Cattle futures found some traction Thursday with a let up in Corn futures and perhaps some short covering.

Live Cattle futures closed an average of $1.24 higher (40¢ to $1.72 higher).

Feeder Cattle futures closed an average of $3.07 higher ($2.55 to $3.45 higher).

Corn and Soybean futures took a breather Thursday from the recent steep run-up.

Corn futures closed mostly 7¢ to 8¢ lower.

Soybean futures closed 14¢ to 40¢ lower through Sep ‘24 and then mostly 6¢ lower.

KC HRW Wheat closed mostly 5¢ to 6¢ higher.

Negotiated cash fed cattle trade ranged from limited on light demand to mostly inactive on very light demand through Thursday afternoon, with too few transactions to trend in any region, according to the Agricultural Marketing Service.

So far this week, live prices are $2 lower in the Southern Plains at $180/cwt., $3-$4 lower in Nebraska at $182-$185 and $2-$3 lower in the western Corn Belt at $184-$185.

Last week, dressed prices were $296 in Nebraska and $294-$300 in the western Corn Belt.

Choice boxed beef cutout value was 22¢ higher Thursday afternoon at $334.47/cwt. Select was 45¢ lower at $303.80/cwt

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Major U.S. financial indices firmed Thursday with the most support for tech stocks.

The Dow Jones Industrial Average closed 4 points lower. The S&P 500 closed 16 points higher. The NASDAQ was up 128 points.

West Texas Intermediate Crude Oil futures (CME) closed $2.39 to $3.02 lower through the front six contracts, pressured by central banks around the world raising interest rates, as well as concerns about China’s economic growth and demand.

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Current and recent U.S. Drought Monitors paint a clear picture behind the drought premiums added to grain and soybean futures.

For the week beginning June 20, drought existed across 58.5% of the Midwest, compared to 48.7% a week earlier and 32.1% two weeks earlier.

For the same week, 64% of U.S. corn production was in drought areas, compared to 57% a week earlier and 45% two weeks earlier. The same week last year, drought covered 17% of production.

Likewise, 57% of U.S. soybean production was affected by drought the week beginning June 20, compared to 51% a week earlier, 39% two weeks earlier and 11% a year earlier.

For the same week, drought encompassed 27.1% of the Continental U.S. versus 25.0% a week earlier and 34.5% two weeks earlier. Forty percent of U.S. cattle were in areas affected by drought.