WLI

Cattle futures climbed back Monday as funds appeared to retrench following last week’s losses.

Toward the close, Live cattle futures were an average of $4.42 higher. Feeder Cattle futures were an average of $6.81 higher.

Negotiated cash fed cattle trade was inactive on light to moderate demand in all major cattle feeding regions through Monday afternoon, according to the Agricultural Marketing Service.

Last week, FOB live prices were mainly $2 lower in the Southern Plains at $240/cwt. and $2-$3 lower in the North at $240. Dressed delivered trade was $5-$8 lower at $375-$378.

The five-area direct weighted average FOB live fed steer price last week was $3.22 lower at $239.33/cwt. The weighted average dressed delivered fed steer price was $7.00 lower at $376.15.

Choice boxed beef cutout value was $1.51 lower Monday afternoon at $398.53/cwt. Select however, was 36¢ higher at $378.80.

Turning to grain complex, futures turned lower on likely profit taking from the previous session’s gains. 

Toward the close and through away Jly contracts, Corn futures were 5¢ to 6¢ lower. Kansas City Wheat futures were unchanged to fractionally lower. Soybean futures were mostly 3¢ to 4¢ lower.

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Major U.S. financial indices closed higher Monday, led by tech stocks and positive comments from the White House regarding trade talks with China.  

The Dow Jones Industrial Average closed 49 points higher. The S&P 500 closed 30 points higher. The NASDAQ was up 207 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures (CME) were 50¢ to 65¢ higher through the front six contracts.

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“Beef prices remain strong, and beef demand is robust despite the availability of favorably priced alternative proteins,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. 

For perspective, Peel notes retail beef prices posted another record high in August, according to USDA data. The all-fresh retail beef price was 12.6% higher year over year, which was more than a dollar higher at $9.18 per pound. He adds that even as wholesale beef prices decline seasonally, last week’s value was 31.7% higher year over year, with all primal values higher for the period.

Conversely, Peel points out retail pork prices in August were lower month to month and 2.2% higher year over year. Retail broiler prices were fractionally higher compared to July and were 1.9% higher year over year.

“Moving into the fall, consumer demand shifts from a summer grilling focus to crock-pot cooking and increased restaurant visits,” Peel says. “This may slightly change relative values among beef products, but beef product demand continues strong at all levels.”

Cattle futures regained some ground Thursday. Toward the close, Live cattle futures were an average of $1.17 higher. Feeder Cattle futures were an average of $2.03 higher.

Negotiated cash fed cattle trade was moderate on moderate demand in Nebraska through Thursday afternoon, according to the Agricultural Marketing Service. So far this week, FOB live prices are $3-$4 lower at $238-$240/cwt. and dressed delivered prices are $8 lower at $375.

Elsewhere, trade was mostly inactive on moderate demand.

FOB live prices this week are mainly $2-$3 lower in the western Corn Belt at mostly $240. Dressed delivered prices in the region last week were $383.

Last week, FOB live prices were $242 in the Texas Panhandle and $242-$243 in Kansas.

Choice boxed beef cutout value was $4.85 lower Thursday afternoon at $400.79. Select was $3.73 lower at $379.95.

Grain and Soybean futures bounced back Thursday, ahead of Friday’s monthly World Agricultural Supply and Demand Estimates. 

Toward the close and through away Jly contracts, Corn futures were mostly 2¢ to 3¢ higher. Kansas City Wheat futures were mostly 3¢ higher. Soybean futures were mostly 7¢ to 8¢ higher.

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Major U.S. financial closed higher Thursday with more traders apparently betting on the Fed cutting interest rates next week.

The Dow Jones Industrial Average closed 617 points higher. The S&P 500 closed 55 points higher. The NASDAQ was up 157 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures (CME) were $1.23 to $1.43 lower through the front six contracts.

Live Cattle futures firmed and clawed mostly higher Wednesday, while all but the front months drifted lower in Feeder Cattle.

Toward the close, Live cattle futures were an average of $1.21 higher. Feeder Cattle futures were an average of $1.40 lower, except for an average of $1.06 higher in the front two contracts.  

Negotiated cash fed cattle trade ranged from inactive on light demand in the Southern Plains to limited on moderate demand in the North through Wednesday afternoon, according to the Agricultural Marketing Service.

For the week, FOB live prices are mostly $2-$3 lower in the western Corn Belt at mostly $240/cwt. and dressed delivered prices are $8 lower in Nebraska at $375.

Last week, FOB live prices were $242/cwt. in the Texas Panhandle and $242-$243 in Kansas and Nebraska. Dressed delivered prices were mainly $383 in the western Corn Belt.

Choice boxed beef cutout value was $2.03 lower Wednesday afternoon at $405.64. Select was $3.28 lower at $383.68.

Grain and Soybean futures were lower again Wednesday with likely continued positioning ahead of Friday’s monthly World Agricultural Supply and Demand Estimates. 

Toward the close and through away Jly contracts, Corn futures were 2¢ to 3¢ lower. Kansas City Wheat futures were 3¢ to 4¢ lower, except for 2¢ higher in waning spot Sep. Soybean futures were mostly 5¢ to 6¢ lower.

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Major U.S. financial indices closed mixed Wednesday, but with positive inflation data.

The Producer Price Index for final demand edged down 0.1% in August, seasonally adjusted, according to the U.S. Bureau of Labor Statistics. That was more favorable than the trade expected. On an unadjusted basis, however, the index for final demand rose 2.6% for the 12 months ended in August.

The Dow Jones Industrial Average closed 220 points lower. The S&P 500 closed 19 points. The NASDAQ was up 6 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures (CME) were 98¢ to $1.13 higher through the front six contracts.

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Since 2022, calf prices have increased by 135.6%; feeder cattle prices are up by 107.4%; fed prices have increased 70.0%; boxed beef prices are up 59.2%; and retail prices have increased by 21.3%, according to Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. However, he also points out the cost of inputs has increased more and faster than the value of outputs for all of the margin sectors — stockers, feedlot, packers and retailers.

“Up to this point, packers have faced most of the losses due to lousy buy-sell margins,” Peel says. “Feedlots have avoided much of the margin challenges thus far, largely due to the strongly up trending market combined with the time lag between placements and marketings (extended by more days on feed in most cases) and a sharp decrease in feed costs.  Feedlot cost of gain is down over 28% since the peak in early 2023.”

Stocker producers are being squeezed hard from both directions, Peel explains, as high calf prices increase stocker purchase cost and feedlots are competing more for limited feeder supplies, including lighter weight feeders due relatively low cost of gain. 

“Retailers have faced relatively less of the margin challenge up to this point due to strong consumer beef demand and ample beef supplies,” Peel says. “Beef production is declining faster now, and retailers will face more challenges as beef production continues to decline in the coming months.”

In the meantime, Peel says, “Cow-calf producers will continue to enjoy strong returns and the higher calf prices that encourage herd rebuilding.  Those higher calf prices will continue to work their way through the industry up to consumers in a complex set of market dynamics affecting the various sectors in a variety of ways.”

Cattle futures plunged Tuesday with technical correction, exaggerated by apparent fund selling and wariness over seasonal pressure on cash fed cattle prices and wholesale beef values.

Toward the close, Live cattle futures were an average of $5.93 lower. Feeder Cattle futures were limit down $9.25, except for $7.80 lower in the back contract.  

Negotiated cash fed cattle trade ranged from inactive on light demand in the Southern Plains to limited on light to moderate demand in the North through Tuesday afternoon, according to the Agricultural Marketing Service. Although too few to trend, there were some early dressed delivered trades in the North at $375-$382 and a few FOB live sales in the western Corn Belt at $237-$239.

Last week, FOB live prices were $242/cwt. in the Texas Panhandle and $242-$243 in the other regions. Dressed delivered prices were mainly $383.

Choice boxed beef cutout value was $2.02 lower Tuesday afternoon at $407.67. Select was $1.62 higher at $386.96.

Grain and Soybean futures were lower Tuesday with likely profit taking and position squaring ahead of Friday’s monthly World Agricultural Supply and Demand Estimates. 

Toward the close and through away Jly contracts, Corn futures were 1¢ to 2¢ lower. Kansas City Wheat futures were mostly 7¢ to 8¢ lower. Soybean futures were 2¢ to 3¢ lower.

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Major U.S. financial indices closed higher again Tuesday.

The Dow Jones Industrial Average closed 196 points higher. The S&P 500 closed 17 points higher. The NASDAQ was up 80 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures (CME) were 47¢ to 57¢ higher through the front six contracts.

Cattle futures were mostly higher Monday but hesitantly.

Toward the close, Live cattle futures were an average of 58¢ higher, except for 22¢ lower in spot Oct. Feeder Cattle futures were an average of 98¢ higher, except for 65¢ lower in away Sep.  

Negotiated cash fed cattle trade was inactive on light demand in all major cattle feeding regions through Monday afternoon, according to the Agricultural Marketing Service.

Last week, FOB live prices were $242/cwt. in the Texas Panhandle and $242-$243 in the other regions. Dressed delivered prices were mainly $383.

The five-area direct weighted average FOB live fed steer price last week was $1.05 less at $242.55/cwt. The weighted average dressed delivered fed steer price was $2.50 less at $383.15.

Choice boxed beef cutout value was $1.07 lower Monday afternoon at $409.69. Select was 15¢ lower at $385.34.

Grain and Soybean futures were higher Monday with likely short covering and positioning ahead of Friday’s monthly World Agricultural Supply and Demand Estimates. 

Toward the close and through away Jly contracts, Corn futures were 2¢ to 4¢ higher. Kansas City Wheat futures were mostly 11¢ higher. Soybean futures were 3¢ to 7¢ higher.

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

The Dow Jones Industrial Average closed 114 points higher. The S&P 500 closed 13 points higher. The NASDAQ was up 98 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures (CME) were 59¢ to 70¢ higher through the front six contracts.

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Calves and feeder cattle continued to sell mainly higher last week. Keeping in mind the fewer business days due to the holiday, USDA’s Agricultural Marketing Service (AMS) pegged the advance at mostly $5-$10 higher, with calf prices steady to $5 higher in some areas and $10-$12 higher in parts of the Southeast.

“In many areas producers are moving calves ahead of normal due to the record prices, and at the other end many are holding on as the upward trend continues …” according to AMS analysts.

Trade volume of 192,700 head at auction, direct and via video-internet was 1,000 head fewer than the previous weeks and about 24,000 head fewer than the same week last year.

The CME Feeder Cattle index was $2.56 higher week to week on Friday at $367.03.

“What may be more amazing than anything is that this market could easily continue increasing in the current environment. As cattle producers begin to retain heifers to grow the herd, there will be fewer feeder cattle available, which will restrict beef production despite the ever-increasing dressed weights,” says Andrew P. Griffith, agricultural economist at the university of Tennessee, in his weekly market comments. “As producers navigate the high price environment, it is important to manage price risk and financial risk … The basic aspect that makes risk management more important today than a few years ago is the quantity of dollars necessary to play in the game.”