WLI

Cattle futures continued higher Friday, spurred along by higher cash fed cattle prices.  

Live Cattle futures closed an average of $1.01 higher across a wide range, from 5¢ higher at the back to $2.50 higher in spot Oct, except for 10¢ lower in away Dec.

Feeder Cattle futures were mixed Friday, closing from an average of 37¢ higher in five contracts to an average of 48¢ lower.

Week to week on Friday, Live Cattle futures closed an average of $2.92 higher, and Feeder Cattle futures closed an average of $4.52 higher.

Negotiated cash fed cattle trade was slow on light demand in the Texas Panhandle through Friday afternoon with FOB live prices $2 higher at $183/cwt., according to the Agricultural Marketing Service. Trade and demand were moderate in Kansas with FOB live prices $2-$3 higher at $183.

Trade and demand were moderate in the North. FOB live prices were $2-$3 higher in Nebraska at $184 and $1-$2 higher in the western Corn Belt at $184-$185. Dressed delivered prices were $2 higher in Nebraska at $290-$292. Dressed delivered prices the previous week were $288-$294 in the western Corn Belt.

Choice boxed beef cutout value was 63¢ higher Friday afternoon at $300.19/cwt. Select was 33¢ higher at $288.59.

Estimated total cattle slaughter last week of 610,000 head was 10,000 head fewer than the previous week and 17,000 head fewer than the previous year. Estimated year-to-date total cattle slaughter of 22.7 million head was 943,000 head fewer (-4%). Estimated year-to-date beef production of 19.1 billion pounds was 192.9 million pounds less (-1%).

Harvest pressure continued to weigh on grain futures Friday.

Corn futures were mostly 3¢ to 4¢ lower. Kansas City Wheat futures were fractionally lower to 1¢ lower. Soybean futures were mostly 1¢ to 2¢ lower.

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Major U.S. financial indices closed narrowly mixed, retaining the week’s sharp gains.

The Dow Jones Industrial Average closed 38 points higher. The S&P 500 closed 11 points lower. The NASDAQ was down 65 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME closed 3¢ to 18¢ lower through the front six contracts.

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Markets will likely view Friday’s monthly Cattle on Feed report as plumb neutral.

For feedlots with 1,000 head or more capacity, August placements of 1.98 million head were 28,000 head fewer (-1.4%) year over year, which was in line with expectations ahead of the report.

In terms of placement weights, 35% went on feed weighing 699 lbs. or less, 47% weighing 700-899 lbs. and 18% weighing 900 lbs. or more.

Marketings in August of 1.82 million head were 67,000 head fewer (-3.6%) than the prior year, also in line with expectations.

Cattle on feed Sept. 1 of 11.2 million head were 71,000 head more (+0.6%) year over year, which was also in line with estimates ahead of the report.

Cattle futures bounced higher Thursday with support from bullish outside markets and perhaps with some positioning ahead of Friday’s monthly Cattle on Feed report.

Heading into the close, Live Cattle futures were an average of 94¢ higher. Feeder Cattle futures an average of $2.64 higher.

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

Last week, live FOB prices were $181/cwt. in the Texas Panhandle, $180-$181 in Kansas, $181-$182 in Nebraska and $182-$183 in the western Corn Belt. Dressed delivered prices were $288-$294.

Choice boxed beef cutout value was $1.82 lower Thursday afternoon at $299.56/cwt. Select was $1.49 lower at $288.26.

Net 2024 U.S. beef export sales of 15,500 metric tons for the week ending Sept. 12 were 36% more than the previous week and 2% more than the prior four-week average, according to USDA’s weekly report. Increases were primarily for South Korea, China, Japan, Canada and Mexico.

Harvest pressure and anemic export sales weighed on grain futures Thursday.

Toward the close and through Jly ’25 contracts, Corn futures were 5¢ to 7¢ lower. Kansas City Wheat futures were 11¢ to 13¢ lower. Soybean futures were mostly fractionally lower to 1¢ lower.

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Major U.S. financial indices closed sharply higher Thursday, fueled by the previous day’s interest rate cut by the Fed and fewer weekly initial unemployment claims than expected.

For the week ending September 14, the advance figure for seasonally adjusted initial claims was 219,000, a decrease of 12,000 from the previous week’s revised level, according to the U.S. Department of Labor.

The Dow Jones Industrial Average closed 522 points higher. The S&P 500 closed 93 points higher. The NASDAQ was up 440 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were 82¢ to $1.16 higher through the front six contracts.

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Forecasters estimate a 71% chance of a short-lived La Niña emerging during September-November and persisting through January-March 2025, according to the latest update from the National Weather Service Climate Prediction Center.

In the meantime, dryness continues to expand across the nation, according to the latest U.S. Drought Monitor.

Abnormally dry or drought conditions encompassed 70.3% of the continental U.S. compared to 55.6% at the same time last year. However, moderate to exceptional drought existed in 35.6% of the nation versus 37.8% a year earlier. Overall, 35% of the nation’s cattle were in drought areas compared to 45% at the same time last year.

Cattle futures were narrowly mixed Wednesday as traders waited for weekly cash direction.

Heading into the close, Live Cattle futures were an average of 25¢ higher, except for unchanged and 32¢ lower on either end of the board. Feeder Cattle futures were an average of 28¢ higher, except for an average of 9¢ lower in three contracts.

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

Last week, live FOB prices were $181/cwt. in the Texas Panhandle, $180-$181 in Kansas, $181-$182 in Nebraska and $182-$183 in the western Corn Belt. Dressed delivered prices were $288-$294.

Choice boxed beef cutout value was $2.53 lower Wednesday afternoon at $301.38/cwt. Select was $2.47 lower at $289.75.

Heading toward the close and through Jly ’25 contracts, Grain futures were mixed Wednesday.

Toward the close and through Jly ’25 contracts. Corn futures were fractionally mixed. Kansas City Wheat futures were 1¢ lower. Soybean futures were mostly 5¢ to 8¢ higher, supported by early reports of lower yields than expected.

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Major U.S. financial indices closed lower Wednesday, following a volatile trading session tied to the Fed’s decision to cut interest rates by 0.5% rather than the widely anticipated reduction of 0.25%.

“Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have slowed, and the unemployment rate has moved up but remains low. Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated,” according to the FOMC statement.

The Dow Jones Industrial Average closed 103 points lower. The S&P 500 closed 16 points lower. The NASDAQ was down 54 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were 61¢ to 75¢ lower through the front six contracts.

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Based on recent price weakness, USDA’s Economic Research Service (ERS) slashed expected average feeder steer prices for the remainder of this year in the latest Livestock, Dairy and Poultry Outlook. Compared to the previous month’s projections, ERS reduced the forecast third-quarter price by $9 to $252/cwt. and the fourth-quarter price by $13 to $255 for an annual average price of $251, which was $5.50 lower. The prices are basis Medium and Large #1 steers weighing 750-800 lbs., selling at Oklahoma City.

ERS analysts explain the average August price at Oklahoma National Stockyards was $15.78/cwt. less than the prior month and represented the first year-over-year decline since February 2021.

For next year, ERS reduced the forecast first-quarter price by $3 to $248 and the second-quarter price by $5 to $254 for an annual average price of $254, which was $5 less than the previous month’s projection.

As mentioned in Cattle Current recently, the ERS lowered expected five-area direct fed steer prices for the remainder of this year and the first half of 2025, in the September World Agricultural Supply and Demand Estimates.

Forecast prices were lowered by $3 in the third quarter to $188/cwt. and by $7 in the fourth quarter to $183 for an annual average of $185.11, which was $3 lower than the previous month’s estimate. Projected prices were lowered in the first quarter next year by $3 to $186 and by $4 in the fourth quarter to $186 for an annual average price of $186, which was $5 lower.

Cattle futures gained Tuesday.

Heading into the close, Live Cattle futures were an average of $1.11 higher. Feeder Cattle futures were an average of $1.80 higher

Negotiated cash fed cattle trade ranged from mostly inactive on light demand to a standstill through Tuesday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.

Last week, live FOB prices were $181/cwt. in the Texas Panhandle, $180-$181 in Kansas, $181-$182 in Nebraska and $182-$183 in the western Corn Belt. Dressed delivered prices were $288-$294.

Choice boxed beef cutout value was 66¢ lower Tuesday afternoon at $303.91/cwt. Select was 8¢ higher at $292.22.

Heading toward the close and through Jly ’25 contracts, grain futures were narrowly changed. Corn futures were 1¢ to 2¢ higher. Kansas City Wheat futures were fractionally higher. Soybean futures were 2¢ higher.

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Major U.S. financial indices settled little changed Tuesday, ahead of this week’s Fed decision regarding interest rates.

The Dow Jones Industrial Average closed 15 points lower. The S&P 500 closed 1 point higher. The NASDAQ was up 35 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were 97¢ to $1.19 higher through the front six contracts.

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Judging by history, U.S. beef cow herd contraction could continue for another year or two, according to Rob Ziegler Extension livestock production and marketing specialist at the University of Wyoming.

“Beef cow slaughter peaked in 2011 at 3.9 million head, roughly midway through the last contraction phase, which ended in 2014 when expansion began,” Ziegler explains in the latest issue of In the Cattle Markets from the Livestock Marketing Information Center. “Slaughter bottomed out in 2015 at 2.2 million head and started increasing again in 2016. Another peak in cow slaughter was observed in 2022 at nearly 4 million head. In 2023, cow slaughter declined by 12% compared to 2022. From January through August 2023, 2.2 million head of beef cows were slaughtered, compared to 1.9 million head during the same period in 2024.”

Given that 35% of annual cow slaughter occurs, historically, between September and December, Ziegler says it appears total cow slaughter in 2024 will be less year over year at around 2.9 million head. If so, it would the second consecutive year of reduced beef cow slaughter.

Even though market dynamics suggest potential herd rebuilding in the next 1-2 years, Ziegler also points to the different situation faced today than during the last expansion.

“Elevated interest rates and higher input costs in recent years have negatively impacted income per cow,” Ziegler says. “The question remains whether these margins will be sufficient to encourage expansion within that timeframe. While the drought in 2024 has been more regional, some heifer retention may be correlated with these areas. That said, heifers retained this year will not contribute to the feeder cattle supply for approximately two more years. These factors suggest that the expansion phase may unfold more slowly than it did in 2014.”

Cattle futures were narrowly mixed Monday, with Live Cattle edging lower and Feeder Cattle mostly eking out gains.

Heading into the close, Live Cattle futures were an average of 21¢ lower. Feeder Cattle futures were an average of 30¢ higher, except for unchanged and 32¢ lower in two contracts.

Negotiated cash fed cattle trade ranged from limited on light demand to a standstill through Monday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.

For the week, Live FOB prices were steady to $1 higher in the Texas Panhandle at $181/cwt., steady to $1 lower in Kansas at $180-$181, mostly steady in Nebraska at $181-$182 and steady to $2 higher in the western Corn Belt at $182-$183.

Dressed delivered prices were steady to $6 higher in Nebraska at $288-$294 and steady to $8 higher in the western Corn Belt at $288-$294.

The five-area direct weighted average FOB live steer price last week was 93¢ higher at $182.11/cwt. The weighted average dressed delivered price was $3.07 higher at $290.61.

Grain futures were lower Monday amid the improved international weather outlook and potential profit taking.

Toward the close and through Jly ’25 contracts, Corn futures were 1¢ to 3¢ lower. Kansas City Wheat futures were 18¢ to 19¢ lower. Soybean futures were 1¢ lower.

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Major U.S. financial indices were mixed Monday, ahead of this week’s Fed decision regarding interest rates.

The Dow Jones Industrial Average closed 228 points higher. The S&P 500 closed 7 points higher. The NASDAQ was down 91 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were $1.36 to $1.85 higher through the front six contracts.

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Resurgent drought in parts of the Southern Plains is reducing wheat pasture prospects and related calf demand.

In Oklahoma, for instance, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University says very little wheat has been planted, or it has been dusted in hoping for rain.

“The start of winter grazing will be pushed back, and stocking rates will likely be reduced due to less available forage through the winter,” Peel explains in his weekly market comments. “The lack of wheat stocker demand and the beginning of the fall run of calves is putting pressure on cattle auction prices.”