WLI

Cattle futures ran out of steam Tuesday with technical pressure and lower wholesale beef values.

Toward the close, Live Cattle futures were an average of $1.32 lower. Feeder Cattle futures were an average of $2.76 lower, except for 7¢ higher in spot Oct.

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

Last week, FOB live prices were $190-$191/cwt. in the Texas Panhandle $190 in Kansas and mostly $190 in the North. Dressed delivered prices were $2 higher in Nebraska at $298 and $2-$4 higher in the western Corn Belt at $298-$300 in a light test.

Choice boxed beef cutout value was $2.89 lower Tuesday afternoon at $320.61/cwt. Select was $2.22 lower at $289.96.

Toward the close and through Sep ’25 contracts, Kansas City Wheat futures were 12¢ to 13¢ higher Tuesday with the bearish crop rating in Monday’s Weekly Crop Progress report indicating, 38% was in Good (33%) or Excellent (5%) condition versus 47% at the same time last year. 23% was rated as Poor (16%) of Very Poor (7%) compared to 18% a year earlier.

Corn futures were fractionally higher to 3¢ higher. Soybean futures were 2¢ to 8¢ lower.

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Major U.S. financial indices closed mixed Tuesday with support from tech stocks but pressure from the rising Treasury yield.

The Dow Jones Industrial Average closed 154 points lower. The S&P 500 closed 9 points higher. The NASDAQ was up 145 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were 10¢ to 12¢ higher through the front six contracts.

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Creighton University’s Rural Mainstreet Index (RMI) sank below growth neutral in October for the 14^th consecutive month, to the lowest level since the start of the covid pandemic in the spring of 2020.

Weak agriculture commodity prices, sinking agriculture equipment sales, elevated input costs and falling farmland prices drove the decline, according to Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

The RMI is based on a monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy. October’s overall reading declined 2.3 points from the previous month to 35.2. The index ranges between 0 and 100, with a reading of 50.0 that represents growth neutral.

Approximately, 61.5% of bankers indicated that the financial position of farmers in their service area had deteriorated over the past six months. The remaining 38.5% reported that farmers’ financial position was unchanged over the past six months.

Cattle futures were higher Monday, shrugging off Friday’s Cattle on Feed report, supported by high cash trade.

Toward the close, Live Cattle futures were an average of 24¢ higher. Feeder Cattle futures were an average of 86¢ higher.

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, FOB live prices were $2-$3 higher in the Texas Panhandle at $190-$191/cwt., mostly $2 higher in Kansas at mainly $190 and $2-$3 higher in the North at mostly $190. Dressed delivered prices were $2 higher in Nebraska at $298 and $2-$4 higher in the western Corn Belt at $298-$300 in a light test.

Choice boxed beef cutout value was $1.26 higher Monday afternoon at $323.50/cwt. Select was $2.90 lower at $292.18.

Grain and Soybean futures were lower again Monday on the decline on Crude Oil futures and the planting pace in South America.

Toward the close and through Sep ’25 contracts, Corn futures were 1¢ to 5¢ lower. Kansas City Wheat futures were 10¢ lower. Soybean futures were 9¢ to 13¢ lower.

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Major U.S. financial indices closed higher Monday, helped along by a sell0ff in Crude Oil futures as traders removed war risk premium.

The Dow Jones Industrial Average closed 273 points higher. The S&P 500 closed 15 points higher. The NASDAQ was up 48 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were $3.54 to $3.81 lower through the front six contracts.

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Continued large inventories of heifers on feed confirms that little or no heifer retention is starting in 2024, according to Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. 

“Heifer slaughter is down 1.7% year over year thus far in 2024,” Peel says.  “Heifer slaughter would have to drop significantly more if heifers were being retained for breeding. In the most recent beef herd expansion, heifer slaughter decreased an average of just over 10% each year in 2014 and 2015.”

The quarterly inventory of heifers on feed was 4.6 million head, down 0.9% year over year. Heifers made up 39.7% of the total feedlot inventory on October 1, up slightly from the 39.6% in July. 

Heifers have averaged 39.5% of total feedlot inventories for the past 10 quarters, since July 2022, and have been above the 15-year average of 36.9% since October 2018, according to Peel.

Feeder Cattle futures were narrowly mixed Friday with likely trepidation ahead of the monthly Cattle on Feed report (see below). On Friday, Feeder Cattle closed from an average of 12¢ higher across the front half of the board to an average of 32¢ lower across the back half. They were also narrowly mixed in early-Monday trading.

Live Cattle futures were an average of 11¢ lower, except for 40¢ higher in spot Oct and unchanged in April.

Week to week on Friday, Live Cattle futures closed an average of $1.09 higher (27¢ to $2.07 higher). Feeder Cattle futures closed mixed, from an average of 80¢ higher in the front three contracts to an average of $1.60 lower.

Negotiated cash fed cattle trade ranged from slow on light demand in the North to inactive on very light demand the Southern Plains through Friday afternoon, with too few transactions to trend.

For the week, FOB live prices were $2-$3 higher in the Texas Panhandle at $190-$191/cwt., mostly $2 higher in Kansas at mainly $190 and $2-$3 higher in the North at mostly $190. Dressed delivered prices were $2 higher in Nebraska at $298 and $2-$4 higher in the western Corn Belt at $298-$300 in a light test.

Last week’s weighted average five-area direct FOB live fed steer was $2.44 higher at $190.05. The average dressed delivered steer price was $2.69 higher at $298.90.

Choice boxed beef cutout value was $1.07 higher Friday afternoon at $322.24/cwt. Select was 74¢ higher at $295.08. Week to week on Friday, Choice was $1.59 higher and Select was 88¢ higher. 

Estimated total cattle slaughter last week of 623,000 head was 15,000 head more than the same week last year. Year-to-date estimated total cattle slaughter of 25.7 million head was 1 million head less (-3.8%). Year-to-date beef production of 21.8 billion pounds was 146.5 million pounds less (-0.7%).

Grain and Soybean futures closed lower Friday on profit taking, producer selling and harvest pressure.

Corn futures were 3¢ to 6¢ lower through Jly ’25 and then 1¢ to 2¢ lower. Kansas City Wheat futures were 13¢ to 15¢ lower. Soybean futures were 5¢ to 8¢ lower through Aug ’25 and then mostly 3¢ lower.

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Major U.S. financial were mixed Friday.

The Dow Jones Industrial Average closed 259 points lower. The S&P 500 closed 1 point lower. The NASDAQ was up 103 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were $1.38 to $1.59 higher through the front six contracts.

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Markets viewed the monthly Cattle on Feed report as neutral despite more placements than expected.

Feedlots with 1,000 head or more capacity placed 2.2 million head in September, which was 42,000 head less (-1.9%) year over year but 2.3% more than expectations ahead of the report.

Marketings in September of 1.7 million head were 34,000 head more (+2.0%) than the same week last year, which was in line with expectations.

Cattle on Feed Oct. 1 of 11.6 million head was slightly less year over year, which was also in line with expectations. Heifers comprised 40% of the on-feed inventory, which was 1% less than a year earlier.

Feeder Cattle futures softened Wednesday. Perhaps some of the softness had to do with the announcement yesterday that an E. coli outbreak in several states had been linked to a McDonald’s Quarter Pounder; more specifically, slivered onions (see below).

Toward the close, Feeder Cattle futures were an average of $1.95 lower. Live Cattle futures were an average of 16¢ lower, except for 5¢ higher in away-Oct.

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

Last week, FOB live prices were $188/cwt. in the Southern Plains and $187-$188 in the North. Dressed delivered prices were $296.

Choice boxed beef cutout value was $2.55 lower Wednesday afternoon at $321.41/cwt. Select was 97¢ higher at $295.77.

Turning to the grain complex, toward the close and through Sep ’25 contracts, Corn futures were fractionally higher to 3¢ higher. Kansas City Wheat futures were little changed. Soybean futures were 1¢ to 6¢ higher.

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Major U.S. financial closed sharply lower Wednesday, under pressure from rising Treasury yields.

The Dow Jones Industrial Average closed 409 points lower. The S&P 500 closed 53 points lower. The NASDAQ was down 296 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were 69¢ to 76¢ lower through the front six contracts.

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The U.S. Centers for Disease Control and Prevention (CDC) reported Tuesday that an outbreak of E. coli O157:H7 had been linked to Quarter Pounders at McDonalds.

“The specific ingredient linked to illness has not yet been identified, but investigators are focused on two ingredients in particular: fresh slivered onions, and fresh beef patties,” according to the CDC … McDonald’s reported to CDC that they proactively removed the slivered onions and beef patties used for the Quarter Pounder hamburgers from stores in the affected states while the investigation continues. Quarter Pounder hamburgers in some states may be temporarily unavailable.”

All told, 49 people from 10 states (mostly Colorado and Nebraska) have gotten sick from the same strain of E. coli.

McDonald’s North America Chief Supply Chain Officer Cesar Piña shared the following internal message…

“…The initial findings from the investigation indicate that a subset of illnesses may be linked to slivered onions used in the Quarter Pounder and sourced by a single supplier that serves three distribution centers. As a result, and in line with our safety protocols, all local restaurants have been instructed to remove this product from their supply and we have paused the distribution of all slivered onions in the impacted area.

“Out of an abundance of caution, we are also temporarily removing the Quarter Pounder from restaurants in the impacted area, including Colorado, Kansas, Utah and Wyoming, as well as portions of Idaho, Iowa, Missouri, Montana, Nebraska, Nevada, New Mexico, and Oklahoma.”

Cattle futures gained Tuesday, with support from the continued increase in Choice boxed beef cutout values.

Toward the close, Live Cattle futures were an average of 89¢ higher. Feeder Cattle futures were an average of $1.33 higher

Negotiated cash fed cattle trade ranged from inactive on very light demand to a standstill through Tuesday afternoon, according to the Agricultural Marketing Service.

Last week, FOB live prices were $188/cwt. in the Southern Plains and $187-$188 in the North. Dressed delivered prices were $296.

Choice boxed beef cutout value was $1.10 higher Tuesday afternoon at $323.96/cwt. Select was $1.41 lower at $294.80.

Corn and Soybean futures were higher again Tuesday with follow-through support.

Toward the close and through Sep ’25 contracts,

Corn futures were 4¢ to 7¢ higher. Kansas City Wheat futures were 3¢ higher. Soybean futures were mostly 12¢ higher.

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Major U.S. financial closed narrowly mixed Tuesday.

The Dow Jones Industrial Average closed 6 points lower. The S&P 500 closed 2 points lower. The NASDAQ was up 33 points.

Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were $1.26 to $1.68 higher through the front six contracts.