WLI

Cattle futures closed higher Thursday, supported by the prospects of steady to higher cash trade, as well as more favorable domestic economic growth than expected.

Before settlement, Live Cattle futures were an average of $1.01 higher across a wide range. Feeder Cattle futures were an average of 52¢ higher.

Negotiated cash fed cattle trade ranged from slow on light demand to inactive on very light demand through Thursday afternoon, according to the Agricultural Marketing Service. Although too few to trend, there were som early live FOB sales in Kansas at $190/cwt.

Last week, live FOB prices were $188-$188.50 in the Texas Panhandle, 187-188 in Kansas and $196 in the North. Dressed delivered prices were $310/cwt.

Choice boxed beef cutout value was 22¢ lower Thursday afternoon at $312.46/cwt. Select was $1.15 higher at $295.11/cwt.

Grain and Soybean futures were mixed Thursday.

Heading into the close, through Jly ’25 contracts Corn futures were mostly 3¢ higher. Soybean futures were mostly 13¢ to 15¢ higher as traders applied more weather premium. However, Kansas City Wheat futures were 6¢ to 7¢ lower on bullish harvest reports and anemic export sales.

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Major U.S. financial indices closed mixed Thursday, with continued pressure from tech stocks but with support from more robust economic growth than expected.

Real gross domestic product (GDP) increased at an annual rate of 2.8% in the second quarter this year, according to the “advance” estimate from the U.S. Bureau of Economic Analysis. The increase primarily reflected increases in consumer spending, inventory investment, and business investment. In the first quarter, real GDP increased 1.4%.

The Dow Jones Industrial Average closed 81 points higher. The S&P 500 closed 27 points lower. The NASDAQ was down 160 points.

Heading into the close, West Texas Intermediate Crude Oil futures on the CME were 23¢ to 57¢ higher through the front six contracts.

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Food price inflation is easing, according to data from USDA’s Economic Research Service (ERS). Although retail food prices rose 0.9% during the first half of this year, it was significantly less than the year-over-year increase of 4.8% at the same time last year and the 1.9% average increase from 2003 to 2022.

“Compared with recent years, price growth slowed across categories partly because of economy-wide factors, such as reductions in supply chain congestion and softening consumer demand for goods, although price trends differ by food category,” ERS analysts say. “For example, prices for cereals and bakery products showed minimal growth since mid-2023, following strong price increases throughout 2022 and the first half of 2023. In contrast, the midyear inflation rate for meats in 2024 exceeded its growth in the first half of 2023.”

Cattle futures were mostly lower Wednesday, pressured by bearish outside markets and the lack of weekly cash direction.

Before settlement, Live Cattle futures were an average of 71¢ lower, except for unchanged to an average of 45¢ higher in the front three contracts. Feeder Cattle futures were an average of $1.79 lower.

Negotiated cash fed cattle trade ranged from limited 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 $188-$188.50/cwt. in the Texas Panhandle, 187-188 in Kansas and $196 in the North. Dressed delivered prices were $310/cwt.

Choice boxed beef cutout value was 53¢ lower Wednesday afternoon at $312.68/cwt. Select was $2.70 lower at $293.96/cwt.

Grain futures firmed Wednesday, while Soybean futures declined after recent gains.

Heading into the close, through Jly ’25 contracts, Corn futures were fractionally high to 1¢ higher. Kansas City Wheat futures were fractionally higher to 2¢ higher. Soybean futures were mostly 9¢ to 11¢ lower.  

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Major U.S. financial indices closed sharply lower Wednesday, as investors bailed out of tech holdings, and bellwethers like Tesla and Alphabet posted sub-par earnings.

The Dow Jones Industrial Average closed 504 points lower. The S&P 500 closed 128 points lower. The NASDAQ was down 654 points.

Heading into the close, West Texas Intermediate Crude Oil futures on the CME were little changed through the front six contracts.

Cattle futures extended gains Tuesday. Before settlement, Live Cattle futures were an average of $1.21 higher.  Feeder Cattle futures were an average of $1.72 higher.

Negotiated cash fed cattle trade ranged from slow on light demand to a standstill in all major cattle feeding regions through Tuesday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.

Last week, live FOB prices were steady to 50¢ higher in the Texas Panhandle at $188-$188.50/cwt. steady to $1 lower in Kansas at $187-$188 and $2 lower in the North at $196. Dressed delivered trades were $2 lower at $310/cwt.

Choice boxed beef cutout value was 23¢ lower Wednesday afternoon at $313.21/cwt. Select was $1.67 lower at $296.66/cwt.

Traders continued adding weather premium to Soybean futures Tuesday. Heading into the close, through Jly ’25 contracts, Soybean futures were mostly 4¢ to 7¢ higher. Corn futures were fractionally higher to 1¢ higher. Kansas City Wheat futures were 4¢ lower.     

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Major U.S. financial indices closed little changed Tuesday.

The Dow Jones Industrial Average closed 57 points lower. The S&P 500 closed 8 points lower. The NASDAQ was down 10 points.

Heading into the close, West Texas Intermediate Crude Oil futures on the CME were $1.08 to $1.12 lower through the front six contracts.

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Inventories of cattle on-feed longer than 90 and 120 days are above historical averages for several reasons, according to Rob Ziegler, Extension livestock economist at the University of Wyoming.

“Lower ration prices, coupled with high fed cattle prices, are incentives for producers to put weight on cattle,” Ziegler explains in the latest issue of In the Cattle Markets. “The increase in popularity of beef on dairy cattle, as shown by a reduction in veal, also contributes to increased days on feed.”

Although longer feeding periods and heavier carcasses have boosted beef production higher than originally anticipated, Ziegler notes third-quarter beef production is projected to be 5.6% less year over year.

Cattle futures strengthened Monday, helped along by positive outside markets and the monthly Cattle on Feed report (see below), which indicated fewer placements than expected last month.

Before settlement, Live Cattle futures were an average of $1.05 higher.  Feeder Cattle futures were an average of 54¢ higher, well off session highs, capped by advancing Corn futures. 

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

Last week, live FOB prices were steady to 50¢ higher in the Texas Panhandle at $188-$188.50/cwt. steady to $1 lower in Kansas at $187-$188 and $2 lower in the North at $196. Dressed delivered trades were $2 lower at $310/cwt.

The weighted average five-area direct FOB live steer price last week was 57¢ lower at $193.67. The weighted average dressed delivered steer price was $2.56 lower at $310.04.

Choice boxed beef cutout value (p.m.): 39¢ lower at $313.44/cwt. Select was 47¢ lower at $298.33/cwt.

Soybeans led the grain complex higher Monday with short covering and apparent weather premium based on the global outlook.

Heading into the close, through Jly ’25 contracts, Soybean futures were 21¢ to 33¢ higher. Corn futures were 10¢ to 11¢ higher. Kansas City Wheat futures were 1¢ to 2¢ higher.  

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Major U.S. financial indices rebounded Monday, as investors bought back tech stocks.

The Dow Jones Industrial Average closed 127 points higher. The S&P 500 closed 59 points higher. The NASDAQ was up 280 points.

Heading into the close, West Texas Intermediate Crude Oil futures on the CME were 4¢ to 25¢ lowermthrough the front six contracts.

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Derrell Peel, Extension livestock marketing specialist at Oklahoma State University provides further perspective to the recent monthly Cattle on Feed report in his weekly market comments.

“Although the feedlot inventory has been slow to decrease, feedlots have been placing fewer cattle as feeder supplies have dwindled in recent years,” Peel says.  “The total U.S. calf crop peaked in 2018 in the most recent cattle cycle and has been declining each of the past five years. The 2024 calf crop is estimated to be another 1.5% smaller year over year leading to a total decline since 2018 of 8.9% or 3.2 million head.”

While marketings in June were 8.7% less year over year, Peel explains average daily marketing were slightly higher when accounting for two less business days this year than last.

Peel also points out the percentage of heifers in the on-feed mix July 1 was near the highest level in the past 20 years at 40%.

“The heifer percentage of feedlot inventories drops below the average level (36.7%) during periods of heifer retention and herd rebuilding and is above average during periods of herd liquidation,” Peel explains.

Cattle futures continued mostly lower Friday ahead of the monthly Cattle on Feed report (see below), which could provide some support Monday.

Live Cattle futures were an average of 47¢ lower, except for an average of 65¢ higher in the front two contracts. Week to week on Friday, Live Cattle futures were an average of 85¢ lower (40¢ to $1.30 lower), except for 72¢ higher in spot Aug.

Feeder Cattle futures were an average of 94¢ lower on Friday. They were an average of $1.73 lower week to week (92¢ lower at the back to $3.05 lower at the front).

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

For the week, live FOB prices were unevenly steady in the Southern Plains at $188/cwt. and $2 lower in the North at $196. Dressed delivered trades were $2 lower at $310/cwt.

Choice boxed beef cutout value was $2.32 lower Friday at $313.83/cwt. Select was 66¢ lower at $298.80.

Choice boxed beef cutout value was $8.23 lower week to week on Friday at $313.83/cwt. Select was $3.51 lower at $298.80.  Over the last two weeks, Choice is down $16.60 and Select is down $6.26.

Estimated total cattle slaughter last week of 584,000 was 17,000 fewer than the previous week and 42,000 head fewer (-6.7%) than the same week last year. Year-to-date estimated total cattle slaughter of 17.3 million head was 821,000 head fewer (-4.5%) than the same period last year. Year-to-date estimated beef production of 14.6 billion pounds was 242.5 million pounds less (-1.6%).

Turning to the grain complex, Grain and Soybean futures were mixed Friday in search of a bottom and also likely impacted by the widespread internet outage.

Corn futures closed fractionally mixed to unchanged. Kansas City Wheat futures 7¢ higher through May ’25 and then mostly 3¢ higher. Soybean futures were mostly 7¢ to 10¢ lower.

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Major U.S. financial indices continued lower Friday, as investors sold mega-tech stocks.

The Dow Jones Industrial Average closed 377 points lower. The S&P 500 closed 39 points lower. The NASDAQ was down 144 points.

Heading into the close, West Texas Intermediate Crude Oil futures on the CME were $2.19 to $2.69 lower through the front six contracts.

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Markets will likely view the monthly Cattle on Feed report as friendly with fewer placements than expected.

For feedlots with 1,000 head or more capacity, placements of 1.56 million head in June were 115,000 head less (-6.8%) year over year, which was about 4% less than pre-report expectations.

In terms of placement weights, 39% went on feed weighing less than 700 lbs., 44% weighing 700-899 lbs. and 16% weighing 900 lbs. or more.

Marketings in June of 1.79 million head were 171,000 head fewer (-8.7%) than the previous year, which was 0.5% less than estimates ahead of the report. Marketings were the second lowest for the date since the data series began in 1996.

Cattle on feed July 1 of 11.3 million head were 61,000 head more (+0.5%) than a year earlier, but that was 0.7% less than expectations ahead of the report.

Heifers and heifer calves comprised 40% of the on-feed mix, the same as a year earlier.

Heifer slaughter is 1% less year over year, and cow slaughter is down 14%, through the first six months, according to USDA’s Economic Research Service (ERS). However, the weekly-average percentage of heifers and cows in the slaughter mix during that period is the third most of the last 20 years, according to ERS analysts, in the July Livestock, Dairy and Poultry Outlook.