Daily Market Highlights

Negotiated cash fed cattle trade was limited on light demand in all feeding regions through Friday afternoon, according to the Agricultural Marketing Service, with too few transactions to trend.

For the week, live prices were steady in the Southern Plains at $138/cwt., but steady to $2 lower at $138-$140 in Nebraska and the western Corn Belt. Dressed trade was also steady to $2 lower at $220.

Cattle futures closed narrowly mixed Friday, with support from higher wholesale beef prices, but with continued concern about slower cattle harvest.

Estimated cattle slaughter last week of 620,000 head was 32,000 head fewer than the same week last year.

Feeder Cattle futures closed narrowly mixed, from an average of 36¢ lower to an average of 36¢ higher.

Live Cattle futures closed an average 20¢ higher, except for an average of 29¢ lower in three contracts.

Choice boxed beef cutout value was $3.26 higher Friday afternoon at $271.82/cwt. Select was 46¢ higher at $26.10.

Grain futures gained Friday with ongoing bearish weather in South America and expectations to see corn and soybean estimates in that region trimmed when the monthly World Agricultural Supply and Demand Estimates come out Wednesday.

Soybean futures closed 19¢ to 24¢ higher through the front six contracts and then mostly 11¢ to 14¢ higher.  

Corn futures closed mostly 3¢ higher through Sep ’23 and then mostly 7¢ to 8¢ higher.

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Major U.S. financial indices continued to decline Friday. Pressure included rising treasury yield rates and a monthly jobs report that was less robust than expected.

The non-farm payroll increased 199,000 in December, according to the U.S. Bureau of Labor Statistics. Average hourly earnings for all employees on private non-farm payrolls increased by 19¢ in December to $31.31. Average hourly increased by 4.7% over the previous 12 months.

The Dow Jones Industrial Average closed 4 points lower. The S&P 500 closed 19 points lower. The NASDAQ was down 144 points.

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U.S. beef export value reached another new high in November, topping $1 billion for the second time in 2021, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF).

Beef exports for the month of 123,641 metric tons (mt), were 7% more than a year earlier and the fourth largest monthly volume in the post-BSE era. Export value was a record $1.05 billion, up 49% year-over-year and exceeding the previous high set in August 2021.

For January through November, U.S. beef exports were on a record volume pace at 1.32 million mt, up 16% from a year ago. Beef export value, which had already set a new annual record through October, increased more than $2.5 billion from a year ago, soaring 39% to $9.59 billion.

Beef export value per head of fed slaughter equated to a record $480.67 in November, up 42% from a year ago. The January-November average was $402.09, up 35%.

Through November, U.S. pork export value was $7.5 billion, up 7% from a year ago and rapidly approaching the annual record of $7.71 billion set in 2020.

“With one month of results still to be tabulated, it’s very gratifying to see red meat exports setting new annual records and achieving remarkable growth over a wide range of markets,” says USMEF President and CEO Dan Halstrom. “It is important, however, that we do not take this success for granted or allow it to detract from the challenges facing U.S. agriculture. Global demand for U.S. red meat has never been stronger, but labor and transportation obstacles and high input costs across the supply chain make it increasingly difficult to satisfy this demand. USMEF greatly appreciates the effort by lawmakers, maritime regulators and other officials to address the persistent congestion at U.S. ports, but this continues to be a costly and frustrating situation for U.S. exporters and their international customers.”

Negotiated cash fed cattle trade was limited on light demand in all feeding regions through Thursday afternoon, according to the Agricultural Marketing Service, with too few transactions to trend.

For the week, live prices are steady in the Southern Plains at $138/cwt., but steady to $2 lower at $138-$140 in Nebraska and the western Corn Belt. Dressed trade is also steady to $2 lower at $220.

Cattle futures inched higher Thursday, although skittishness remains concerning recently slower cattle harvest amid anecdotal reports of increasing health challenges among workers.

Live Cattle futures closed an average 34¢ higher, except for an average of 12¢ lower in two contracts. 

Feeder Cattle futures closed an average 69¢ higher, except for 32¢ lower in Sep.

Choice boxed beef cutout value was $1.63 higher Thursday afternoon at $268.56/cwt. Select was $1.03 higher at $260.64/cwt.

Soybean futures closed 3¢ to 7¢ lower through Aug ‘22 and then mostly 7¢ to 14¢ higher. 

Corn futures closed 1¢ to 4¢ higher at either end of the board and fractionally mixed to 8¢ higher in the middle.

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Major U.S. financial indices eased lower Thursday, with follow-through pressure from Fed minutes the previous day indicating a faster pullback in economic stimulus.

The Dow Jones Industrial Average closed 170 points lower. The S&P 500 closed 4 points lower. The NASDAQ was down 19 points.

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Higher commodity prices, favorable financial conditions and the desire for an inflation hedge all contributed to resurgent prices for quality farmland, according to Farmers National Company (FNC).

“What started as a gradual strengthening of sales prices last fall escalated into aggressive bidding the past five months to generate new highs in prices paid for farmland in many areas,” says Randy Dickhut, FNC senior vice president of real estate operations. “Prices for good quality farmland are up 15 to 35% depending on the location.” 

Most areas of the Grain Belt experienced an increase in the amount of land sold during the last 12 months, starting with additional sale activity last fall, according to FNC.

“Non-operating landowners became more active sellers of land during 2021 with the higher prices drawing their attention as well as the potential threat of tax law changes,” Dickhut explains.

Higher prices also were driven by the increased use of competitive bidding sales methods, according to FNC. In addition to the traditional public auction approach, various online auction methods are becoming commonplace.

Negotiated cash fed cattle trade was slow to moderate on moderate demand in Nebraska and the western Corn Belt through Wednesday afternoon, according to the Agricultural Marketing Service. Dressed trade in Nebraska was $2 lower at $220/cwt. Although too few to trend, there were some early live sales at $138, compared to $140 last week.

There were some early live sales in the western Corn Belt steady at $140 and a few in the beef steady to $2 lower at $220, but too few of either to trend.

Trade in the Southern Plains was limited on light demand. A light test sold steady on a live basis at $138.

Cattle futures closed mixed Wednesday, supported by moderating grain futures price gains but pressured by the weaker cash outlook. 

Live Cattle futures closed an average of 41¢ lower, except for an average of 32¢ higher in two contracts.

Feeder Cattle futures closed an average 32¢ higher, except for unchanged to an average of 36¢ lower in the front three contracts.

Choice boxed beef cutout value was 11¢ higher Wednesday afternoon at $266.93/cwt. Select was 38¢ higher at $259.61/cwt.

Soybean futures closed 4¢ to 6¢ higher through Aug ‘23 and then 2¢ to 3¢ higher.

Corn futures closed 4¢ to 7¢ lower through the front four contracts and then mostly 1¢ lower.

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Major U.S. financial indices closed sharply lower Wednesday, apparently fueled by the Fed’s most recent minutes suggesting stimulus tapering could accelerate and rate hikes could be coming sooner than anticipated. Queasiness relates to whether the Fed will begin reducing its balance sheet — taking liquidity from the market — once the bond buying program ends.

Positive news on the day included the closely-watched ADP^®National Employment^™report coming in significantly stronger than the trade expected with 807,000 private sector jobs added from November to December.

“December’s job market strengthened as the fallout from the Delta variant faded and Omicron’s impact had yet to be seen,” says Nela Richardson, ADP chief economist. “Job gains were broad-based, as goods producers added the strongest reading of the year, while service providers dominated growth. December’s job growth brought the fourth quarter average to 625,000, surpassing the 514,000 average for the year. While job gains eclipsed 6 million in 2021, private sector payrolls are still nearly 4 million jobs short of pre-COVID-19 levels.”

The Dow Jones Industrial Average closed 392 points lower. The S&P 500 closed 92 points lower. The NASDAQ was down 522 points.

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Agricultural producer sentiment grew more positive last month, according to the Purdue University/CME Group Ag Economy Barometer. It climbed 9 points month to month in December to 125, only the second increase since last May.

The Index of Current Conditions and the Index of Future Expectations also increased with stronger current conditions responsible for the barometer’s rise. December’s Index of Current Conditions rose 18 points to a reading of 146, while the Index of Future Expectations rose 4 points to a reading of 114.

“Excellent crop yields this fall combined with strong crop prices provided many producers with their most positive cash flow in recent years. That combination helps explain the year-end rise in the financial index as well as the barometer overall,” says James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture.

December marked the second consecutive month that producers reported stronger financial performance for their operations. The Farm Financial Performance Index rose 7 points to 113 in December, which is the index’s highest reading since May and 21% higher than readings obtained just before the pandemic’s onset.

Agricultural producers expressed concern about rising production costs and the availability of production inputs. When asked about the biggest concerns for their operation in the upcoming year, 47% of respondents selected higher input cost from a list that included lower crop and/or livestock prices, environmental policy, farm policy, climate policy and COVID’s impact. More than half (57%) of producers said they expect farm input prices in the upcoming year to rise by more than 20% compared to a year earlier. Nearly four out of 10 respondents said they expect input prices to rise by more than 30%.

Producers were also asked if they’ve had any difficulty purchasing crop inputs from their suppliers for the 2022 season. Nearly four out of 10 (39%) said they’ve experienced some difficulties. In a follow-up question, producers who indicated they were experiencing difficulties in making purchases were asked which crop inputs they’ve had trouble purchasing. Responses were varied, which could be an indication of problems across the supply chain, and included difficulties in purchasing fertilizer (31%), herbicides (28%), farm machinery parts (24%) and insecticides (17%).

The Ag Economy Barometer is calculated each month from 400 U.S. agricultural producers’ responses to a telephone survey. The latest survey was conducted December 8-14, 2021.

Negotiated cash fed cattle trade was at a standstill through Tuesday afternoon, according to the Agricultural Marketing Service.

Last week, live prices were at $138/cwt. in the Southern Plains and $140 in Nebraska and the western Corn Belt. Dressed trade was at $220-$222.

Surging corn futures took Cattle futures down a peg Tuesday, especially Feeder Cattle.

Feeder Cattle futures closed an average of $1.99 lower (70¢ lower toward the back to $3.57 lower in spot Jan).

Live Cattle futures closed an average of 77¢ lower (5¢ to $1.52 lower).

Choice boxed beef cutout value was 79¢ higher Tuesday afternoon at $266.82/cwt. Select was 33¢ higher at $259.23/cwt.

Bearish South American weather lit a fuse beneath soybeans, leading other grain futures along for the ride.

Soybean futures closed 27¢ to 34¢ higher through Aug ‘22 and then 12¢ to 18¢ higher in the next four contracts; mostly 2¢ higher the rest of the way.

Corn futures closed 10¢ to 20¢ higher through the front four contracts and then mostly 4¢ to 8¢ higher.

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Major U.S. financial indices closed mixed Tuesday, with most of the pressure coming from tech stocks. 

The Dow Jones Industrial Average closed 214 points higher. The S&P 500 closed 3 points lower. The NASDAQ was down 210 points.

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“The pandemic has significantly altered how our economy functions, with the greatest impact coming from what we consume. Through October, in 2021 Americans spent 18% more on goods and about 1% less on services than they did in 2019. Compounded by a labor shortage, it is easy to see why supply chains have become one of the biggest economic challenges of the pandemic — demand has significantly exceeded the capacity of our existing system,” according to the 2022 Year Ahead Report from CoBank’s Knowledge Exchange.

CoBank analysts expect the U.S. farm economy to continue struggling with the ongoing supply chain dysfunction and cost inflation issues that emerged in the summer of 2021. They say historically strong prices will be more than offset by increases in cost structure for nearly all crop production including row crops, fruits and vegetables, and hay. They do not anticipate any significant pullback in farm-level costs until the third quarter of this year, at the earliest.

Moreover, according to the report, “Wage rates and overall labor costs are expected to remain firmly higher in 2022 as the industry seeks solutions to reduced labor availability. Automation capital expenditures at the plant level will continue in earnest despite the rapidly rising costs of machinery and equipment. Most processors view this as a necessary cost of doing business moving forward.”

However, CoBank analysts also explain, “Livestock producer margins should continue to be generally favorable overall, with the effect of shrinking beef cattle supplies finally showing up in higher prices at the producer level.”

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

Last week live prices were at $138/cwt. in the Southern Plains and $140 in Nebraska and the western Corn Belt. Dressed trade was at $220-$222.

The five-area direct average steer price last week of $139.59/cwt. on a live basis was $3.95 higher than the previous week. The average steer price in the beef was $3.58 higher at $220.89.

Year-to-date estimated total cattle slaughter through Dec. 27 was 32.66 million head, according to USDA. That was 958,000 head more (+3.0%) than a year earlier. Total estimated beef production of 27.05 billion lbs. was 694.4 million lbs. more (+2.6%).

Cattle futures eased lower Monday awaiting cash direction.

Live Cattle futures closed an average of 38¢ lower, not counting newly minted away-Jun.

Feeder Cattle futures closed an average of 45¢ lower.

Choice boxed beef cutout value was 77¢ higher Monday afternoon at $266.03/cwt. Select was 67¢ higher at $258.90/cwt.

Corn futures closed mostly 1¢ to 2¢ higher, except for fractionally lower to 4¢ lower in the front four contracts.

Soybean futures closed 12¢ to 16¢ higher through Sep ‘23 and then 7¢ to 8¢ higher.

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Major U.S. financial indices climbed higher Monday, buoyed by tech stocks.

The Dow Jones Industrial Average closed 246 points higher. The S&P 500 closed 30 points higher. The NASDAQ was up 187 points.

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“During December the price for 500-600-lb. steers in South Dakota briefly averaged above $190/cwt. for a couple of weeks, a level last observed in early 2016,” says Matthew Diersen, risk and business management specialist at South Dakota State University, in the latest issue of In the Cattle Markets. “The value of calves depends on the expectations for their ultimate value as finished animals. Thus, the price of calves expected in 2022 depends on where the trade thinks the price of fed cattle will be in mid-2023. The LMIC (Livestock Marketing Information Center) projections have the price of fed cattle higher in 2022 than in 2021 with a further increase expected in 2023. That bodes well for calf price expectations and the LMIC projections are for higher calf prices in 2022, but prices can still fluctuate.”

On the other side of the equation, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University stresses the need to focus on feed cost management in order to capitalize on the optimistic revenue outlook.

“In part, marketing forage involves considering cattle production and marketing alternatives that represent higher value for forage,” Peel explains, in his weekly market comments. “For cow-calf producers, this includes considerations for marketing calves at weaning or retaining calves for backgrounding/stocker production as well as marketing cull breeding animals.

“The market environment in 2022 may provide more possibilities with reduced cattle numbers favoring weaned calf production and marketing, yet at the same time, higher grain prices and elevated feedlot cost of gain increase the value of added forage-based weight gain on feeder cattle. Producers will have more options and potential to add value, and planning now can improve returns to cattle and forage production later.”

You can watch Peel share his market outlook for next year here.

Negotiated cash fed cattle prices gained last week amid holiday-lightened trade. For the week, based on USDA reports available through Thursday, live prices were $2 higher in Nebraska at $140/cwt., $3 higher in the Texas Panhandle at $138 and $5 higher in the western Corn Belt at $140. Dressed prices of $220-$222 were $3-$4 higher in Nebraska and $3-$5 higher in the western Corn Belt.

Live Cattle futures traded sideways amid light trade on Friday. They closed narrowly mixed, from an average of 16¢ lower in the front three contracts to an average of 33¢ higher.

Feeder Cattle futures were traded lightly, too, but had the benefit of further erosion in front-month Corn futures. They closed an average of 81¢ higher (5¢ higher at the back to 95¢ higher toward the front), except for 35¢ lower in Sep.

Stronger cash prices and stabilizing wholesale beef prices enabled Cattle futures to gain from Monday through Friday.

Live Cattle futures closed an average of $1.06 higher (42¢ to $1.60 higher). Feeder Cattle futures closed an average of $4.15 higher during the same period ($2.37 higher at the back to $6.67 higher toward the front). The CME Feeder Cattle Index closed $5.99 higher week to week on Thursday at $165.21/cwt.

Choice boxed beef cutout value was 78¢ higher on Thursday at $265.26, compared to Monday. Select was $3.05 higher at $258.23.

Grain futures lost ground throughout the week, due in part to rains in South America.

Corn futures closed an average of 17¢ lower on Friday through the front six contracts, compared to Monday, except for fractionally lower in spot Mar. During the same period, Soybean futures closed an average of 28¢ lower through the front six contracts,

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Major U.S. financial indices eased lower again Friday as investors closed out positions for the year, amid lighter holiday trade.

The Dow Jones Industrial Average closed 59 points lower. The S&P 500 closed 12 points lower. The NASDAQ was down 96 points.

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Restaurant customers can expect to see health taking center stage on restaurant menus in 2022, according to the National Restaurant Association’s (NRA) recent annual What’s Hot Culinary Forecast. It details topics, trends, and products expected to drive restaurant menus in the coming year across a variety of categories.

For instance, after demand for comfort food surged during the height of the pandemic, consumers are refocusing on better-for-you options, with foods that are believed to have immunity-boosting qualities and plant-based sandwiches making up three of the Top 10 Trends for 2022. The report adds plant-based proteins are growing in popularity on menus and less expensive cuts of protein, such as thighs instead of wings, will have a greater presence in the year to come.

Moreover, according to NRA, sustainability will continue to influence menus and how restaurants make decisions across the board. From reusable and recyclable packaging to zero-waste options, restaurants are continuing to prioritize sustainable initiatives. As consumers continue to utilize off-premises options in all dayparts, restaurants are looking to translate their dine-in experience outside the four walls of the restaurant with thoughtful packaging that maintains food quality, retains temperature, and is tamper-proof.

“In addition to a return to health-focused menu offerings and more eco-friendly, improved off-premises packaging, all of which rated high in the top trends, we’re expecting operators to look across their menus for transformative opportunities,” said Hudson Riehle, senior vice president of Research for the Association. “Look for trends that fuse the traditional meal daypart items with other dayparts and an increasing popularity of snacking and its allied items. Also, with the popularity of cocktails-to-go during the pandemic, restaurants will look to expand both alcoholic and non-alcoholic craft beverage options.”

Negotiated cash fed cattle trade was limited on light demand in the Texas Panhandle through Thursday afternoon, but early live sales were $3 higher than last week at $138/cwt.

Elsewhere, trade was mostly at a standstill.

Earlier in the week, live prices in Nebraska and the western Corn Belt were at $140/cwt., which was $5 higher in Nebraska and $2 higher in the western Corn Belt. Dressed prices of $220-$222 were $3-$4 higher in Nebraska and $3-$5 higher in the western Corn Belt.

Cattle futures were narrowly mixed Thursday, as some traders checked out for the year. The weekly U.S. Export Sales report for the week could have added some pressure to Live Cattle. Net U.S. beef export sales for the week ending Dec. 23 were 48% less than the prior week and 55% less than the previous four-week average.

Live Cattle futures closed an average of 36¢ lower.

Feeder Cattle futures closed an average of 46¢ higher (5¢ higher at the back to 95¢ higher toward the front), except for 35¢ lower in Sep.

Choice boxed beef cutout value was 45¢ lower Thursday afternoon at $265.26/cwt. Select was $1.14 higher at $258.23/cwt.

Grain futures closed lower Thursday with rains in South America and position squaring.

Corn futures closed 9¢ to 10¢ lower in the front four contracts and then mostly 5¢ to 6¢ lower.

Soybean futures closed 20¢ to 30¢ lower in the front six contracts and then mostly 5¢ to 7¢ lower.

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Major U.S. financial indices eased lower Thursday, likely due mostly to some month-end and year-end position squaring ahead of what will be a long weekend for some. Positive news on the day included fewer initial jobless claims than expected. Weekly initial unemployment insurance claims for the week ending Dec. 25 were 198,000, which were 8,000 less than previous week, according to the U.S. Department of Labor. That was the lowest level since Oct. 25, 1969.

The Dow Jones Industrial Average closed 90 points lower. The S&P 500 closed 14 points lower. The NASDAQ was down 26 points.

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Some aspects of the U.S. restaurant industry are beginning to improve after being hampered by the pandemic, according to the NPD Group (NPD).

“The increased mobility this fall contributed to year-over-year gains at key restaurant dayparts, although visits are not fully back to pre-pandemic levels,” says David Portalatin, NPD food industry advisor.

In the last three months, ending in November, online and physical visits to restaurants for breakfast increased by 11% compared to a 10% decline during the same period a year ago. From a pre-pandemic view, breakfast traffic is now at the same level as the September through November period in 2019. Morning snack visits improved 6% over the last three months compared to a 7% decline last year and a 1% decline for the same period in 2019. Lunch improved by 4% in the reported period compared to a year ago when visits were down by 11%, but are still 7% below pre-pandemic levels, according to NPD’s continual tracking of the U.S. foodservice industry. 

“We’re in a steady state for the next several months, perhaps with a bump up or down here and there, but we expect to lag pre-pandemic traffic levels through 2022 slightly,” Portalatin says.

Negotiated cash fed cattle trade was limited on light demand in Nebraska and the western Corn Belt through Wednesday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service. So far this week live prices in those regions are at $140/cwt., which is $5 higher in Nebraska and $2 higher in the western Corn Belt. Dressed prices of $220-$222 are $3-$4 higher in Nebraska and $3-$5 higher in the western Corn Belt.

Trade in the Southern Plains was at a standstill. Live prices there last were $135.

Cattle futures, especially Feeder Cattle, climbed higher Wednesday, buoyed by cash market gains and higher wholesale beef prices.

Feeder Cattle futures closed an average of $1.79 higher (97¢ to $2.82 higher with most strength in the front months).

Live Cattle futures closed an average of $1.01 higher (65¢ higher to $1.37 higher).

Choice boxed beef cutout value was $1.05 higher Wednesday afternoon at $265.71/cwt. Select was $1.00 higher at $257.09/cwt.

Corn futures closed mostly 2¢ to 4¢ higher after fractionally mixed in the front three contracts. 

Soybean futures closed mostly 2¢ to 8¢ higher through Jan ‘23 and then 6¢ to 13¢ higher.

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Major U.S. financial indices closed narrowly mixed again Wednesday with holiday-lightened trade and little news to shove it one direction or the other.

The Dow Jones Industrial Average closed 90 points higher. The S&P 500 closed 6 points higher. The NASDAQ was down 15 points.

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Creighton University’s Rural Mainstreet Index (RMI) remained above growth neutral in December for the 12th consecutive month.

“Solid grain prices, the Federal Reserve’s record-low interest rates, and growing exports have underpinned the Rural Mainstreet Economy. USDA data show that 2021 year-to-date agriculture exports are more than 20.7% above the same period in 2020. This has been an important factor supporting the Rural Mainstreet economy,” says Ernie Goss, Ph.D., Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

The RMI stems from a monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy. It slipped one point month to month in December to 66.7. The index ranges between 0 and 100 with a reading of 50.0 representing growth neutral.

“Seven of 10 bankers described their local economy as expanding, while only 6.7% indicated that their local economy was in a modest economic downturn,” says Goss.

More specifically, Todd Douglas, CEO of First National Bank in Pierre, South Dakota, explains, “With the paycheck protection program (PPP) monies, and good commodity prices, even with some areas of reduced yields due to lack of moisture, agriculture borrowers should be in good shape for 2022.”

The region’s farmland price index rose to a record high of 90.0 in December, up from 85.5 in October. The index has been above growth neutral for 15 consecutive months. Bank CEOs say annual cash rents for non-irrigated, non-pasture farmland soared to $262 from $218 one month prior to the pandemic in February 2020.

Jeff Bonnett, CEO of Havana State Bank in Havana Illinois, cautions, “Inflation is real and affecting folks in our service areas.”

“Yields and prices ended being up over projections for 2021 but it appears land costs and all crop inputs will be up significantly in 2022,” says Steve Simon, CEO of South Story Bank & Trust in Huxley, Iowa.

Although it was slow trade and light demand, negotiated cash fed cattle prices began the week $2 higher on a live basis at $140/cwt. in the western Corn Belt through Tuesday afternoon, according to the Agricultural Marketing Service. Dressed prices there last week were at mainly $217.

Elsewhere, trade ranged from a standstill to limited on light demand with too few transactions to trend. Last week, live prices were at $135/cwt. in the Southern Plains and Nebraska. Dressed trade was at $217-$218.

The stronger cash outlook and recently higher boxed beef prices helped Live Cattle futures firm. They closed an average of 24¢ higher (from 5¢ higher to $1.17 higher in almost-spent Dec).

Choice boxed beef cutout value was 18¢ higher Tuesday afternoon at $264.66/cwt. Select was 91¢ higher at $256.09/cwt.

Lower Corn futures prices helped Feeder Cattle close an average of $1.19 higher.

Corn futures closed lower on likely profit taking. Prices were 8¢ to 10¢ lower through May ‘23 and then mostly 4¢ to 5¢ lower.

Soybean futures paused from steep gains in the previous session, closing mostly 3¢ to 4¢ lower.

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Major U.S. financial indices closed narrowly mixed Tuesday

The Dow Jones Industrial Average closed 95 points higher. The S&P 500 closed 4 points lower. The NASDAQ was down 89 points.

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Consumer food prices continue to charge higher.

The Consumer Price Index (CPI) for all items in November was 6.8% higher year over year, according to the U.S. Bureau of Labor Statistics.

“Although the rate of growth is the fastest in nearly four decades, it is still below levels seen during the late 1970s and early 1980s, which were well above 6% and several months recorded double digit growth,” according to analysts with the Livestock Marketing Information Center (LMIC) in a mid-December Livestock Monitor.

The Food CPI was 6.1% higher year over year, apparently driven by surging meat and poultry prices.

“The Meat CPI continued its double-digit growth with November 16.0% above last year. During the pandemic the Meat CPI grew 16.7%, which is still below growth rates of the late 1970s which reached into the 20% range for several months. The Poultry CPI grew 8.4%, which was just below increase of 8.7% in June 2020 during the pandemic,” say LMIC analysts.

Although less startling, the annual year-to-date average monthly CPI was significantly higher through November compared to history.

The year-to-date Consumer Price Index (CPI) for all food increased an average of 3.6% through November, according to the December Food Price Outlook from USDA’s Economic Research Service (ERS). Food-at-home prices were up an average of 3.1% and food-away-from-home prices were 4.2% higher.

“Of all the CPI food-at-home categories tracked by the USDA-ERS, the beef and veal category has had the largest relative price increase (8.7%) and the fresh vegetables category the smallest (0.9%). No food categories have decreased in price in 2021 compared with 2020,” according to ERS analysts.

In 2022, ERS analysts project food-at-home prices to increase 1.5% to 2.5% and food-away-from-home prices to increase between 3.0% to 4.0%.

By way of comparison, food-at-home prices increased 3.5% in 2020 and 0.9% in 2019. The 20-year average is 2.0%.

“November Choice retail beef prices were $7.85 per pound which eased slightly (5 cents) from the prior month’s record high of $7.90. Prices for ground beef, roast, round, and sirloin all remained elevated at in November at $4.72, $7.27, $7.40, and $11.51 per pound, respectively,” according to LMIC analysts. “Retail pork prices continued to climb in November reaching $4.82 per pound, which marks the eighth consecutive month that retail pork prices set a new record. Boneless hams reached a record of $4.94 per pound while bacon and chops remain elevated at $7.27 and $4.43, respectively. The broiler composite retail price hit a record of $2.21 per pound, the fifth consecutive month for a record price.”

Cattle futures closed mixed amid light trade to start the week with front-month Feeder Cattle under the most pressure from increasing Corn futures.

Feeder Cattle futures closed mixed, from an average of 57¢ lower across the front half of the board to an average of 17¢ higher.

Live Cattle futures closed narrowly mixed (from an average of 19¢ lower to an average of 19¢ higher.

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

Last week, live prices were at $135/cwt. in the Southern Plains and Nebraska, and at $138 in the western Corn Belt. Dressed trade was at $217-$218.

The five-area direct weighted average steer price last week was $1.55 lower at $135.64. It was $1.12 lower in the beef at $217.30.

Choice boxed beef cutout value was $1.54 higher Monday afternoon at $264.48/cwt. Select was $2.23 higher at $255.18/cwt.

Nearby Corn and Soybean futures climbed on Monday, presumably in response to the continued hot and dry weather forecast in South America.

Corn futures closed 9¢ through the front three contracts and then mostly 2¢ to 3¢ higher.

Soybean futures closed 26¢ to 30¢ higher through the front five contracts and then mostly 7¢ to 10¢ higher.

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Major U.S. financial indices bounced higher Monday, buoyed by optimistic early reports of holiday spending.

Holiday retail sales, excluding automotive, increased 8.5% year over year during the holiday season Nov. 1 through Dec. 24, according to Mastercard SpendingPulseTM, which measures in-store and online retail sales across all forms of payment. Online sales grew 11.0% compared to the same period last year.

“Shoppers were eager to secure their gifts ahead of the retail rush, with conversations surrounding supply chain and labor supply issues sending consumers online and to stores in droves,” says Steve Sadove, senior advisor for Mastercard and former CEO and Chairman of Saks Incorporated. “Consumers splurged throughout the season, with apparel and department stores experiencing strong growth.”

The Dow Jones Industrial Average closed 351 points higher. The S&P 500 closed 65 points higher. The NASDAQ was up 217 points.

Higher oil prices added support. West Texas Intermediate Crude Oil futures on the CME were $1.72 to $1.78 higher in the front six contracts.

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More lighter-weight cattle placed in feedlots in November — compared to previous months in 2021 — speaks to several unfolding realities, according to Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments.

As noted in the last Cattle Current, November feedlot placements were 3.6% more year over year, according to the latest USDA Cattle on Feed report. Peel points out the increase was comprised of cattle weighing less than 700 lbs., which were 7.0% more than the previous year. Cattle placed on feed at weights heavier than 700 lbs. were 0.7% less.

“Placements of lightweight cattle are typically high in November with seasonally large numbers of spring-born calves. However, the increase may be somewhat exaggerated this year for several reasons,” Peel explains. “Drought limitations are likely contributing to increased placements, the result of reduced opportunities for backgrounding calves this winter. Additionally, drought may also be causing fewer heifers to be held as replacements and further increasing lightweight placements.

“Finally, feedlots may be placing more lightweight cattle simply because overall feeder supplies are declining. As feeder supplies decrease, feedlots will, for a few months, be able to hold feedlot inventories by placing smaller cattle, essentially borrowing against future feeder supplies. Lightweight placements will also add more days on feed and further extend feedlot inventories for a period of time. However, as 2022 proceeds, smaller feeder cattle supplies will result in more pronounced decreases in feedlot inventories.”