WLI

Except for some scattered sales in Kansas on Thursday—steady with the previous day’s higher market in the Southern Plains at $112/cwt.—negotiated cash fed cattle trade remained undeveloped, based on USDA reports.

Cattle futures pulled back from the strong rally the previous day, pressured by outside markets on new doubts about a U.S.-China trade deal.

Live Cattle futures closed an average of 63¢ lower (15¢ lower at the back to $1.70 lower in expiring Oct).

Feeder Cattle futures closed an average of 19¢ lower.

Wholesale beef values were sharply higher on Choice and steady on Select, with moderate to good demand and moderate offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $2.13 higher Thursday afternoon at $232.18/cwt. Select was 18¢ lower at $206.49.

Corn futures closed mostly fractionally lower.

Soybean futures closed mostly 2¢ higher.

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Major U.S. financial indices closed lower Thursday. Pressure included chatter about a more dismal outlook for U.S.-China trade talks, but nothing definitive, as always. Likely, there was also some month-end profit taking and book squaring.

The Dow Jones Industrial Average closed 140 points lower. The S&P 500 closed 9 points lower. The NASDAQ was down 11 points.

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For the first time in a long while, carcass weights trended higher year over year, for the week ending Oct. 19.  

The average dressed steer weight was 900 lbs., according to the most recent Actual Slaughter Under Federal Inspection report. That was 1 lb. lighter than the previous week but 6 lbs. heavier than the same time a year earlier. The average dressed heifer weight of 831 lbs. was 3 lbs. heavier than the previous week and 5 lbs. heavier than the previous year.

Negotiated cash fed cattle trade developed in the Southern Plains Wednesday at $112/cwt. on a live basis. That was $2 more than the bulk of last week’s trade in the region.

Likewise, there were four lots of heifers (433 head) offered in the weekly Fed Cattle Exchange Auction, for delivery at 1-9 days. Two Kansas lots sold for a weighted average price of $112. The other two lots were passed at $112.25 and $112.75.

Also, there were 237 head of Ch 2-4 steers at the fat auction in Tama, IA—average weight of 1,445 lbs. They sold for a weighted average price of $113.05

Cattle futures rallied strong on Wednesday, supported by stronger cash fed cattle prices and the sharp seasonal uptick in wholesale beef values.

Except for 2¢ higher in expiring October, Live Cattle futures closed an average of $1.24 higher, with increasing open interest and the heaviest trade in a month. Dec closed at the highest level since April at $118.30.

Other than 60¢ higher in nearly spent October, Feeder Cattle futures closed an average of $2.69 higher, with active trade and expanding open interest.

Wholesale beef values were weak on Choice and sharply higher on Select, with light to moderate demand and offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 50¢ lower Wednesday afternoon at $230.05/cwt. Select was $3.10 higher at $206.67.

Corn futures closed 2¢ to 4¢ higher in the front three contracts, and then mostly fractionally higher.

Soybean futures closed mostly 2¢ lower.

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Major U.S. financial indices closed higher Wednesday. Support included stronger domestic economic performance last month, as well as a positive barometer for job growth.

Real gross domestic product (GDP) increased at an annual rate of 1.9% in the third quarter of this year, according to the advance estimate released by the Bureau of Economic Analysis.

On the jobs front, non-farm jobs in the private sector increased by 125,000 from September to October, according to the closely-watched ADP National Employment report.

Also, as expected, the Federal Open Markets Committee (FOMC), cut the target range for the federal funds rate by 25 points for the third time this year.

The Dow Jones Industrial Average closed 115 points higher. The S&P 500 closed 9 points higher. The NASDAQ was up 27 points.

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Whether current interest in plant-based proteins is a fad or a long-term trend depends on the particular consumer and their reasons for choosing plant-based foods.

That’s the conclusion of a new study by the NPD Group (NPD), which finds that Millennials (born 1981-1996) are the top consumers of plant-based meat alternatives. According to The Future of Plant-based Snapshot, this generational group has adopted plant-based meat alternatives as a way to indulge sensibly while addressing their long-term health goals and animal welfare concerns.

Likewise, the study indicates Gen Xers (born 1965-1980) are also a core consumer group of plant-based meat alternatives. Many in this group are parents of Gen Zs (born 1997 to present), and they raised their Gen Z children on plant-based beverages and foods. Boomers are decelerating their consumption of plant-based meat alternatives but are the top consumers of plant-based dairy alternatives.

Since the core consumer groups for plant-based dairy and meat alternatives are younger, NPD forecasts that plant-based foods, to varying degrees, do have staying power. NPD’s study also finds that plant-based food consumption is not about rejecting traditional protein sources, as about 90% of plant-based users are neither vegetarian nor vegan.

“First and foremost taste is king when considering entering the plant-based foods category,” says Darren Seifer, NPD food and beverage industry analyst. “Attributes such as health and convenience go far to drive consumption, but if the flavor profile falls below consumers’ expectations, then the product will likely have a short run…”

Cattle futures closed mixed Tuesday, with modest pressure likely stemming from technicals, as well as near month-end and contract-end jockeying.

Live Cattle futures closed mixed, from an average of 25¢ higher across the front half of the board to an average of 27¢ lower.

Other than 2¢ higher in spot October and unchanged in Jan, Feeder Cattle futures closed an average of 30¢ lower amid sluggish trade.

Wholesale beef values were sharply higher on good demand and moderate to heavy offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $2.65 higher Tuesday afternoon at $230.55/cwt. Select was $2.81 higher at $203.57.

Corn futures closed mostly fractionally higher to 1¢ higher.

Soybean futures closed fractionally lower to 2¢ lower through Jul ’20 and then fractionally higher to 2¢ higher. 

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Major U.S. financial indices edged Lower Tuesday, amid mixed economic news.

The Dow Jones Industrial Average closed 19 points lower. The S&P 500 closed 2 points lower. The NASDAQ was down 49 points.

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Fed cattle prices next quarter should be supported by the higher proportion of heifers on feed, says Matthew Diersen, a risk and business management specialist at South Dakota State University.

On the other side of the fence, he explains calf prices remain under pressure by the supply of feedlot-ready cattle, made larger as producers retain fewer replacements. But, that also means cyclically higher prices may be closer than originally anticipated.

“The slight increase in cow slaughter volume, coupled with fewer beef replacements, suggest that Jan. 1, 2020 cow inventory levels will be even with or slightly lower than year-earlier levels,” Diersen explains, in the latest issue of In the Cattle Markets. “The USDA baseline did not have a decline happening until 2022. A smaller 2020 calf crop would be supportive of prices next fall.”

The 5-area direct average fed steer price last week was $110.13/cwt. on a live basis, which was 40¢ higher than the previous week. The average dressed steer price of $174.56 was 25¢ higher.

Cattle futures mostly edged higher Monday, with firm cash trade and increasing wholesale beef values. 

Live Cattle futures closed an average of 45¢ higher.

Feeder Cattle futures closed an average of 25¢ higher except for unchanged to 30¢ lower in three contracts.

Wholesale beef values were sharply higher on Choice and higher on Select with good demand and light offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $2.46 higher Monday afternoon at $227.90/cwt. Select was 92¢ higher at $200.76.

Corn futures closed mostly 2¢ lower.

Soybean futures closed 1¢ to 3¢ higher. 

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Major U.S. financial indices closed higher Monday, with follow-through buying, based on strong quarterly earnings reports and reports of progress on the first phase of a U.S.-China trade deal.

The Dow Jones Industrial Average closed 132 points higher. The S&P 500 closed 16 points higher. The NASDAQ was up 82 points.

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Cow slaughter and the mix of heifers on feed continue suggesting a cyclical plateau to the size of the nation’s cowherd.

“The number of heifers on feed (Oct. 1) was 4.4 million head, 2.3% higher year over year,” notes Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “Over the last 20 years, heifers represented an average of 36.7% of feedlot inventories.” They represented 39.1% at the beginning of the month, he says, the highest percentage in more than 18 years. Peel notes the record low was in April 2015, when heifers represented 31.0% of the mix.

Further, Peel says beef cow slaughter so far this year is 2.4% more than last year. Total cow slaughter is up 3.0%, with dairy cow slaughter 3.5% higher.

“Total steer and heifer slaughter thus far in 2019 is up 1.0% year over year. Year-to-date steer slaughter is down 2.4% year over year, while heifer slaughter is up 7.4%…” Peel explains. “Modest increases in yearling and cow slaughter, combined with lower carcass weights, results in year-to-date beef production up 0.5% year over year. Beef production for 2019 is projected to total 27.1 billion lbs., 0.7% higher year over year. Beef production is expected to peak cyclically in 2020 with a slight year-over-year increase to 27.2 billion lbs.” 

So far this year, Peel says steer carcass weights averaged 4.6 lbs. less than last year, while heifer carcass weights averaged 5.4 lbs. less. Cow carcass weights are averaging 6.6 lbs. less. 

Considering Friday’s monthly Cattle on Feed report, Peel adds, “The 12-month moving average feedlot inventory reached 11.6 million head in August and has dropped slightly in the past two months. It is possible that feedlot inventories have peaked cyclically, although there is still a chance that average feedlot totals could push slightly higher into early 2020.”

Except for the Southern Plains, negotiated cash fed cattle trade remained undeveloped through Friday afternoon, based on USDA reports. Live sales in the Southern Plains on Thursday were at $110/cwt., which was $1 higher in Kansas and $2 higher in the Texas Panhandle.

Cattle futures strengthened Friday, supported by steady to higher cash trade, increasing wholesale beef values and higher Lean Hog futures.

Live Cattle futures closed an average of 94¢ higher.

Feeder Cattle futures closed an average of 86¢ higher.

Wholesale beef values were steady to firm on moderate demand offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 18¢ lower Friday afternoon at $225.44/cwt. Select was 75¢ higher at $199.84.

Corn futures closed unchanged to fractionally lower.

Soybean futures closed 9¢ to 13¢ lower through Aug. 20 and then mostly 4¢ to 6¢ lower.

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Major U.S. financial indices closed higher Friday, amid strong quarterly earnings reports and chatter about progress being made on the first phase of a U.S.-China trade deal.

The Dow Jones Industrial Average closed 152 points higher. The S&P 500 closed 12 points higher. The NASDAQ was up 57 points.

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Markets will likely view Friday’s monthly Cattle on Feed report as neutral. Except for about 0.5% more placements than pre-report estimates, numbers reflected most expectations.

Placements in September for feedlots with 1,000 head or more capacity were 2.09 million head. That was 2.04% more (+42,000 head) than last year. As for placement weights: 37.02% weighed less than 700 lbs., 44.67% weighed 700-899 lbs. and 18.30% weighed 900 lbs. or more.

Marketings in September of 1.74 million head were 1.11% more (+19,000 head) than a year earlier.

Cattle on feed Oct. 1 of 11.28 million head were 1.07% less (-122,000 head) than the same time last year. There were 2.32% more (+100,000 head) heifers and heifer calves on feed.