WLI

Negotiated cash fed cattle trade was mostly $3 lower in Nebraska Thursday at mostly $127/cwt. Dressed trade was mostly $3 lower at mostly $205. Dressed sales were $2-$3 lower in the western Corn Belt at mostly $205-$206.

Pessimism began to build about looming cattle supplies as some funds began to unwind long positions. Technical pressure that began in Cattle futures the previous session found a new gear on Thursday, getting more fuel from limit-down moves in Lean Hog futures, which was tied to the lack of exports to China.

Live Cattle futures closed an average of $2.54 lower, for an average of about $4.50 lower in the last two sessions. 

Feeder Cattle futures closed an average of $3.27 lower, for an average of about $6 lower in the last two sessions.

Wholesale beef values were steady to weak on light to moderate demand and moderate to heavy offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 3¢ lower Thursday afternoon at $232.93/cwt. Select was 53¢ lower at $219.75.

Corn futures closed 1¢ higher.

Soybean futures bounced back and closed 3¢ to 4¢ higher.

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Major U.S. financial indices closed mixed on Thursday. Despite mostly positive quarterly earnings reports, the main pressure was attributed to significantly lower 3M earnings than expected.

The Dow Jones Industrial Average closed 134 points lower. The S&P 500 closed 1 point lower. The NASDAQ was up 16 points.

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The latest monthly Livestock Slaughter report from USDA provides further overall perspective regarding the weather impact on carcass weights. 

Average dressed steer weight in March was 11 lbs. less year over year at 867 lbs.  For January-March it was 8 lbs. less at 878 lbs. Average dressed heifer weight was 13 lbs. less year over year at 807 lbs. It was 11 lbs. less for January to March at 817 lbs.

Keeping in mind one less business day in March this year, there were 1.22 million steers harvested under federal inspection in March, which was 105,900 head fewer (-7.9%) than the previous year. There were 42,900 more heifers slaughtered (+5.69%) at 797,300 head. Combined steer and heifer slaughter of 2.02 million head was 63,000 head fewer (-3.03%) than the previous March.

Total cattle slaughter under federal inspection of 2.61 million head in March were 51,100 fewer (-1.92%) than the prior year.

Total commercial beef production in March of 2.12 billion lbs. was 85.8 million lbs. less (-3.89%) year over year.

Total commercial red meat production was 86.8 million lbs. less (-1.92%) at 4.43 billion lbs.

Cattle futures headed south Wednesday, amid presumable profit taking, technical pressure and chatter that the seasonal top in cash fed cattle prices is on the books.

Live Cattle futures closed an average of $1.99 lower ($1.50 to $2.77 lower), with the heaviest trade in a month. 

Feeder Cattle futures closed an average of $2.66 lower ($1.72 lower at the back to $3.10 lower in spot May).

Despite futures negativity, negotiated cash fed cattle trade was at steady money in the Southern Plains at $126/cwt. on moderate trade and demand. There were too few transactions to trend in other regions, but the tone of early sales was decidedly lower in Nebraska and the western Corn Belt.

There were 461 head offered in the weekly Fed Cattle Exchange Auction: 124 head (one lot of Kansas steers) sold for a weighted average price of $127, for delivery at 1-9 days.

Wholesale beef values were lower on light to moderate demand and moderate to heavy offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was $1.15 lower Wednesday afternoon at $232.96/cwt. Select was 98¢ lower at $220.28.

Corn futures closed 2¢ to 4¢ lower.

Soybean futures continued lower, closing down mostly 6¢ to 7¢.

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Major U.S. financial indices closed lower on Wednesday amid mixed quarterly earnings reports and more fretting about the trade impasse with China.

The Dow Jones Industrial Average closed 59 points lower. The S&P 500 closed 6 points lower. The NASDAQ was down 18 points.

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Nearly 150,000 growers in Iowa, Nebraska, Missouri and Kansas are affected by flooding, according to Farm Market iD (FMID), a provider of farm and grower data.

According to FMID, there are nearly 90,000 grain bins located in the flooded areas, which are valued at $4 billion for the structures. The 1.24 billion bu. of storage capacity in the affected area equates to 31% of on-farm grain storage.

“The amount and cost of lost grain and the construction costs to rebuild will impact farmers for years, and some may have a hard time recovering,” says Steve Rao, CEO of FMID. “That said, the majority of on-farm grain storage has not been affected.”

FMID estimates there are 16 million acres in the affected areas intended for planting to corn, wheat or soybeans.

Cattle futures found some stability on Tuesday although Live Cattle edged lower, pressured in part by volatility in Lean Hog futures.

Live Cattle futures closed an average of 19¢ lower.

Except for $1.17 lower in spot May and 12¢ lower in Mar, Feeder Cattle futures closed an average of 18¢ higher.

Corn futures closed mostly 1¢ to 3¢ lower.

Soybean futures closed mostly 10¢ to 15¢ lower through Nov ’20 and then 3¢ to 9¢ lower. Apparently funds are taking advantage of the anemic fundamentals tied to bountiful supplies here and reports of a strong harvest in South America thus far.

Wholesale beef values were weak to lower on light to moderate demand and offerings, according to the Agricultural Marketing Service.

Choice boxed beef cutout value was 37¢ lower Tuesday afternoon at $234.11/cwt. Select was $1.38 lower at $221.26.

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Major U.S. financial indices closed strongly higher on Tuesday, buoyed by better than expected quarterly earnings from a wide array of companies, including Coca-Cola, Twitter and United Technologies.

The Dow Jones Industrial Average closed 145 points higher. The S&P 500 closed 25 points higher. The NASDAQ was up 105 points.

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Total pounds of beef in freezers Mar. 31 were 5% less than the previous month and 3% less than a year earlier, according to USDA’s monthly Cold Storage report.

Similarly, frozen pork supplies were down 1% from the previous month and down slightly from last year.

Total red meat supplies in freezers were 3% less than the previous month and 2% less than a year earlier.

Total frozen poultry supplies were also lower—1% less than the previous month and 2% less than a year ago.

Feeder Cattle futures closed sharply lower Monday, in response to the higher than expected placements in last week’s Cattle on Feed report (see below). That, lower commodity markets overall and a pullback in Lean Hog futures helped drag down Live Cattle futures, despite last week’s firmer cash trade.

Except for 2¢ lower in spot Apr, Live Cattle futures closed an average of 97¢ lower.

Except for 65¢ higher in newly minted away Apr, Feeder Cattle futures closed an average of $1.23 lower.

Corn futures closed mostly 2¢ to 3¢ lower.

Soybean futures closed mostly 2¢ to 3¢ lower.

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

Choice boxed beef cutout value was 83¢ higher Monday afternoon at $234.48/cwt. Select was $2.15 higher at $222.64.

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Major U.S. financial indices mostly hovered in place Monday, with a bump in crude oil prices and energy stocks tempered by angst over the heart of quarterly earnings reporting this week.

The Dow Jones Industrial Average closed 48 points lower. The S&P 500 closed 2 points higher. The NASDAQ was up 17 points.

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Feedlot inventories are underscoring the dynamics of herd expansion, says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments.

“As of Apr. 1, Peel explains that In the five years of herd expansion from 2014 to 2018, heifers in feedlots averaged 34.4% of feedlot inventories. On Jan. 1 and Apr. 1 (this year), heifers accounted for 37.7% of feedlot inventories, indicating that heifer retention slowed significantly through 2018 coming into 2019.”

The data comes from the quarterly snapshot provided in Cattle on Feed reports.

Referring to the most recent one, Peel notes, besides cattle on feed Apr. 1 being record high for the month at 11.96 million head, the 12-month moving average of feedlot inventories is just shy of the record.

“Regional differences in on-feed inventories were pronounced and likely reflect the impacts of winter weather,” Peel says. “Feedlot inventories were up year over year in Texas (+6%); Colorado (+12%), Kansas (+2%) and Oklahoma (+2%). Feedlot totals were down year over year in Nebraska (-4%), Iowa (-4%) and South Dakota (-4%).”