Daily Market Highlights

Negotiated cash fed cattle prices ended the week solidly lower, according to reports from the Agricultural Marketing Service. Regionally, live prices were $5-$7 lower in the Texas Panhandle at $93-$95/cwt., $5 less in Kansas at $95, $3-$7 lower in Nebraska at $95 and $1-$4 less in the western Corn Belt at $98. Dressed trade was $3-$7 less at $155-$156 in Nebraska and at $153-$156 in the western Corn Belt.

The five-area average direct fed steer price through Thursday was $96.24/cwt. on a live basis, which was $4.58 lower than the previous week and $14.34 less than the same period a year earlier. The average dressed steer price was $154.78, which was $5.96 less than the prior week and $24.58 less than a year earlier.

Cattle futures softened to end the week, amid the lower cash fed cattle prices, possible month-end and quarter-end positioning, as well as the picture painted by the monthly Livestock Slaughter report (see below).

Except for 52¢ higher in waning spot Jun, Live Cattle futures closed an average of 62¢ lower (5¢ to 97¢ lower).

Feeder Cattle futures closed an average of $1.08 lower (65¢ lower to $1.75 lower).

Choice boxed beef cutout value was $1.09 lower Friday afternoon at $207.17/cwt. Select was $1.08 lower at $198.85.

USDA estimated total cattle slaughter for the week at 680,000 head, which would be 3.7% more than the previous week and 1.5% more than the same week last year. Total beef production under federal inspection was estimated at 562.3 million lbs., which would be 3.9% more than the previous week and 5.3% more than the same week last year.

Corn futures closed fractionally lower to 1¢ lower.

Soybean futures closed mostly 7¢ to 9¢ lower.

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Major U.S. financial indices closed sharply lower Friday on renewed fears that recent spikes in COVID-19 will further slow nascent economic rebuilding.

The Dow Jones Industrial Average closed 730 points lower. The S&P 500 closed 74 points lower. The NASDAQ closed 259 points lower.

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The latest Livestock Slaughter report from USDA’s National Agricultural Statistics Service (NASS) provides insight to recent packing disruptions, including a reflection of how increased carcass weights are impacting total beef production. Keep in mind, there were two fewer business days in May this year compared to 2019.

Federally inspected beef production in May of 1.83 billion lbs. was 473.3 million lbs. less than the previous year (-20.6%), but 45.6 million lbs. more than the previous month (+2.6%).

Beef production for January through May of 10.50 billion lbs. was 364.7 million lbs. less than the same period a year earlier (-3.4%).

There were 1.70 million fed steers and heifers harvested in January-May, which was just 45,800 head more (+2.8%) than the previous month and 626,100 head fewer (-26.9%) less than May of last year.

For January through May, the 9.8 million steers and heifers slaughtered was 785,600 head fewer (-7.4%) than the same period a year earlier.

The 3.7 million fed heifers harvested in January through May were 199,100 more (+5.0%) than the same time a year earlier.

The 1.3 million beef cows harvested in January through May were 20,100 head more (+1.6%) than the same time a year earlier.

Federally inspected total red meat production of 3.71 billion lbs. in May was 820.3 million lbs. less than the previous May (-18.1%), and 108.2 million lbs. less than in April (-2.8%).

Total red meat production for January through May of 21.81 billion lbs. was 419.7 million lbs. less than the same period a year earlier (-1.9%).

Negotiated cash fed cattle trade continued at lower money for the week with live sales in the Texas Panhandle on Thursday down $5-$7 at $93-$97/cwt.

Cattle futures closed mainly higher, with support likely including lower corn prices and positive export news.

Weekly net U.S. beef export sales as of June 18 were 24,400 metric tons (mt), which were 21% more than the previous week and 52% more than the prior four-week average, according to the weekly U.S. Export Sales report from USDA’s Foreign Agricultural Service. Increases were primarily for South Korea, Japan, Taiwan, Mexico, and Hong Kong.

Other than unchanged to an average of 15¢ lower in three contracts, Live Cattle futures closed an average of 32¢ higher.

Feeder Cattle futures closed an average of 49¢ higher.

Choice boxed beef cutout value was $1.43 lower Thursday afternoon at $208.26/cwt. Select was $1.76 lower at $199.93.

The average dressed steer weight for the week ending June 13 was 896 lbs., which was 4 lbs. heavier than the previous week and 47 lbs. heavier than the same week a year earlier, according to USDA’s Actual Slaughter Under Federal Inspection report. The average dressed heifer weight was 824 lbs., which was the same as a week earlier, but 37 lbs. heavier than the prior year.

Corn futures closed 4¢ to 7¢ lower through May ’21 and then mostly 3¢ lower.

Soybean futures closed mostly 1¢ to 3¢ lower through Sep ’21 and then 4¢ to 7¢ lower.

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Major U.S. financial indices closed higher Thursday after a volatile session. Primary support seemed to be the rollback of some regulations for big banks, despite the somber outlook from the International Monetary Fund (IMF).

“Consumption growth, in particular, has been downgraded for most economies, reflecting the larger-than-anticipated disruption to domestic activity,” according to that organization’s most recent quarterly World Economic Outlook. “The projections of weaker private consumption reflect a combination of a large adverse aggregate demand shock from social distancing and lockdowns, as well as a rise in precautionary savings. Moreover, investment is expected to be subdued as firms defer capital expenditures amid high uncertainty. Policy support partially offsets the deterioration in private domestic demand.”

The IMF projects global economic growth this year to be -4.9%, which is 1.9% more negative than its April outlook.

Outlook for economic growth in advanced economies is -8.0%, also 1.9% more negative than April projections. IMF also projects growth for the U.S. this year at -8.0%. Next year, GDP in advanced economies is projected at +4.8%.

The Dow Jones Industrial Average closed 299 points higher. The S&P 500 closed 33 points higher. The NASDAQ closed 107 points higher.

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“The calculated number of cattle on feed longer than 120 days is 5.1 million compared to 4.2 million a year ago,” says David Anderson, Extension Livestock Economist at Texas A&M University, referring to last week’s monthly Cattle on Feed report. “Most of that increase in over 120 days on feed are cattle that have been on feed even longer as evidenced by the number of cattle on feed over 150 days. But, cattle on feed between 90 and 120 days totaled about 1.65 million versus 1.79 million last year. So, there remains more adjustments to come to work through the impacts of corona virus in the cattle markets.”

However, in the most recent issue of In the Cattle Markets, Anderson explains the recent report hints at more normalcy returning to the industry.

For instance, he points out marketings in May were 27.5% less than the prior year, but there were two less business days.

“As May progressed, packing constraints loosened and daily slaughter moved closer to year-ago speeds. June 2020 has 22 slaughter days compared to only 20 in June 2019, so the next report’s marketings will likely show the dual impact of improving slaughter speeds and 10% more workdays in the month,” Anderson says.

Likewise, May feedlot placements (feedlots with 1,000 head or more capacity) were 1.3% less year over year, after being more than 20% less the previous two months.

“May is typically a larger month for placements due to cattle coming off wheat pasture and other small winter grains,” Anderson explains. “Feeder cattle sales did start to pick up as May went on, as cattle previously held back had to move. Some drought conditions likely moved some feeders, and some opportunities to favorably place occurred.”

Except for in the Texas Panhandle, trendable negotiated cash fed cattle trade continued on Wednesday, according to the Agricultural Marketing Service. Live sales were mostly $5 lower in Kansas at mostly $97/cwt. They were $3-$4 lower in Nebraska at $95-$98 and $1-$4 lower in the western Corn Belt at $98. Dressed trade for the week is $3-$6 lower at mostly $156.

Cattle feeders offered 1,221 head in the weekly Fed Cattle Exchange Auction. Of those, 276 head—four lots from Kansas and Nebraska—sold for a weighted average price of $96.43/cwt. for delivery at 1-17 days.

Choice steers and heifers sold $2.75-$3.00 lower at the fat auction in Tama, IA, where 184 Choice 2-4 steers weighed an average of 1,376 lbs. and brought an average price of $100.95.

At Sioux Falls Regional in South Dakota, slaughter steers and heifers sold $4-$6 lower. There were 372 Choice 2-3 steers weighing an average of 1,429 lbs. and bringing an average of $95.86.

Cattle futures tottered on Wednesday as outside markets eroded, but retained the lion’s share of gains made in the previous session.

Live Cattle futures closed an average of 31¢ lower.

Feeder Cattle futures closed narrowly mixed, from an average of 29¢ lower through the front three contracts to an average of 33¢ higher.

Choice boxed beef cutout value was $2.12 lower Wednesday afternoon at $209.69/cwt. Select was $1.88 lower at $201.69.

Corn futures closed mostly 2¢ to 4¢ lower.

Soybean futures closed mostly 3¢ to 4¢ lower. 

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Major U.S. financial indices dove South on Wednesday, with investors apparently spooked by spiking coronavirus cases in some states and what that could mean to reopening the economy.

The Dow Jones Industrial Average closed 710 points lower. The S&P 500 closed 80 points lower. The NASDAQ closed 222 points lower.

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Total pounds of beef in freezers May 31 were down 13% from the previous month but up 2% from last year, according to the most recent USDA Cold Storage report.

Frozen pork supplies were 24% less than the previous month and down 26% from a year earlier. Stocks of pork bellies were down 27% from last month and down 8% from last year.

Total red meat supplies in freezers were 18% less than the previous month and 13% less than a year earlier.

Total frozen poultry supplies were down 5% from the previous month and down 4% from a year ago.

Negotiated cash fed cattle trade continued lower Tuesday, with dressed trade in Nebraska mostly $3-$7 lower than last week at $155/cwt.

Even so, Cattle futures found some spark, helped along by outside markets.

Except for 87¢ lower in spot Jun and 17¢ lower at the back, Live Cattle futures closed an average of 90¢ higher (37¢ to $2.07 higher).

Feeder Cattle futures closed an average of $1.39 higher.

Choice boxed beef cutout value was $2.25 lower Tuesday afternoon at $211.81/cwt. Select was 73¢ lower at $203.57.

Corn futures closed mostly 3¢ to 4¢ lower

Soybean futures closed mostly 1¢ to 4¢ lower through Sep ’21 and then mostly fractionally higher.

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Major U.S. financial indices closed higher Tuesday, led by by tech stocks once again, and despite the growing number of COVID-19 cases.

The Dow Jones Industrial Average closed 131 points higher. The S&P 500 closed 13 points higher. The NASDAQ closed 74 points higher.

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So far, major restaurant chain transactions continue to improve, despite the recent spikes in COVID-19 cases, according to the NPD Group (NPD).

For the week ending June 14, total major restaurant chain transactions were 12% less than the same week a year earlier, which represented a 1% improvement compared to the previous week.

More specifically, quick service chain transactions were 11% less year over year and 2% more positive than the previous week. Full service chain transactions were 26% less than a year earlier but improved 12% week to week.

“The only major variable in play with a case surge at the moment would be erosion in consumer willingness to dine out,” says David Portalatin, NPD food industry advisor. “There are three main variables that will influence continued restaurant recovery: reopening of on-premise dining and expanding allowed capacity; the willingness of consumers to dine out and feel safe and confident in doing so; and the economic wellbeing of the consumer. Thus far, the evidence in restaurant transactional improvement confirms that dining rooms are opening, and there is consumer demand to fill opened restaurants.”

Although too few to trend, there were a few early live sales in the Texas Panhandle on Monday at $95/cwt. There were a few dressed trades in Nebraska at $152-$155.

Cattle futures closed narrowly lower Monday.

Live Cattle futures closed an average of 22¢ lower.

Feeder Cattle futures closed an average of 55¢ lower, (7¢ lower at the back to 80¢ lower at the front).

Choice boxed beef cutout value was 34¢ higher Monday afternoon at $214.06/cwt. Select was 39¢ higher at $204.30.

Corn futures closed 3¢ to 4¢ lower in the front four contracts and then mostly 1¢ lower.

Soybean futures closed fractionally lower to 1¢ lower. 

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

The Dow Jones Industrial Average closed 153 points higher. The S&P 500 closed 20 points higher. The NASDAQ closed 110 points higher.

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“Wholesale boxed beef prices have dropped nearly back to pre-COVID-19 levels and may go lower into mid-summer as abundant third-quarter beef production could highlight potential recessionary demand weakness,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University.

In his weekly market comments, Peel explains cattle slaughter continues to recover from disruptions wrought by the pandemic, with estimated slaughter the week ending June 20 being 98.2% of year-earlier levels.

At the same time, the backlog of fed cattle continues to add days on feed and pounds per carcass.

Year to date, Peel notes steer and heifer carcass weights averaged 27.4 lbs. heavier year over year. Carcasses were an average of 20.4 lbs. heavier in the first quarter; 36.7 lbs. heavier for April 1 to June 6.

Beef production was 8.0% more year over year in the first quarter, while second-quarter production is estimated to be 14.0% less year over year, according to Peel. That makes for 3.8% less beef production for the year through June 19.

“The combination of recovered slaughter and higher carcass weights resulted in weekly beef production in mid-June estimated to be above year-earlier levels for the first time in 10 weeks,” Peel says. “Weekly beef production is likely to exceed year-earlier levels for the third quarter and perhaps for the balance of the year.”

More specifically, he explains third-quarter beef production is forecast to be nearly 6% higher than the same time last year. Annual beef production this year is forecast to be slightly more than last year at a record 27.3 billion lbs.

“With beef supplies increasing in the second half of the year, beef demand will be critical,” Peel says. “Retail grocery will transition from limited beef supplies in recent weeks to ample supplies at the same time that food service demand is slowly building.” 

Negotiated cash fed cattle prices were lower to sharply lower last week, with significantly heavier carcasses than a year ago and the continued backlog of market-ready cattle.

Based on reports from the Agricultural Marketing Service, the last established market in the Texas Panhandle was at $98/cwt., which was $6-$10 less than the previous week. Until then, prices were about $5 less at around $100, according to the Texas Cattle Feeders Association. Live prices were $4-$6 lower in Kansas at mostly $100-$102, steady to $10 lower in Nebraska at $98-$102 and $3-$4 lower in the western Corn Belt at $99-$102. Dressed trade was steady to $12 lower at $158-$160.

Through Thursday, the five-area direct weighted average price for steers on a live basis was $100.82/cwt., which was  $4.02 less than the previous week. The average dressed steer price was $160.74, which was $5.91 less. Prices at the same time last year were at $110.43 and $180.56, respectively. Keep in mind that carcass weights are contra-seasonal and significantly heavier than last year.

Cattle futures closed mostly narrowly mixed Friday.

Live Cattle futures closed an average of 63¢ lower through the front five contracts (10¢ lower to $1.37 lower in spot Jun) and then an average of 16¢ higher.

Feeder Cattle futures closed narrowly mixed, from an average of 24¢ lower to an average of 24¢ higher.

Choice boxed beef cutout value was 16¢ higher Friday afternoon at $213.72/cwt. Select was 17¢ lower at $203.91.

The average dressed steer weight for the week ending June 6 was 892 lbs., which was 1 lb. heavier than the prior week and 46 lbs. heavier than the same week a year earlier, according to USDA’s Actual Slaughter Under Federal Inspection report. The average dressed heifer weight of 824 lbs. was 2 lbs. lighter than the previous week, but 42 lbs. heavier than the prior year.

Corn futures closed 1¢ to 2¢ higher. 

Soybean futures closed mostly 3¢ to 4¢ higher. 

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Major U.S. financial indices closed mainly lower on Friday, following a volatile session. Key pressure appeared to stem from the spike in COVID cases in some states, leading to worries about the path of economic reopening.

The Dow Jones Industrial Average closed 208 points lower. The S&P 500 closed 17 points lower. The NASDAQ closed 3 points higher.

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If anything, Friday’s monthly Cattle on Feed report from USDA will likely be viewed as at least a touch bearish, with more cattle placed, fewer cattle marketed and slightly more cattle on feed June 1 than the trade expected. That’s for feedlots with 1,000 head or more capacity.

Placements in May of 2.04 million head were 26,000 head fewer (-1.26%) than the previous year. Average analyst estimates ahead of the report expected placements to be 2.3% less.

In terms of placement weights: 33.38% went on feed weighing 699 lbs. or less; 49.93% weighed 700-899 lbs.; 16.69% weighed 900 lbs. or more.

Marketings in May of 1.5 million head were 570,000 head fewer (-27.54%) than a year earlier. That’s the least marketings for the month since the data series began in 1996. Ahead of the report, on average, analysts expected marketings to be down 26.4%.

There were 11.67 million head on feed June 1, which was 57,000 head fewer (-0.49%) than a year earlier. That’s the second highest June inventory since the data series began in 1996. Average analyst expectations were for a decline of 1%.

Negotiated cash fed cattle trade continued in Kansas on Thursday with live prices at $96-$102/cwt., but mostly $100-$102, which was $2-$6 lower than the last week.

Cattle futures softened Thursday, with continued light trade, lower cash prices and the ongoing decline in wholesale beef values.

Live Cattle futures closed an average of 59¢ lower.

Feeder Cattle futures closed an average 71¢ lower. 

Beef exports continue to be a bright spot.

Net U.S. beef export sales of 20,100 metric tons for the week ending June 11 were 1% less than the previous week but 67% more than the previous four-week average, according to the U.S. Export Sales report from USDA’s Foreign Agricultural Service. Increased sales were mainly to South Korea, Japan, Hong Kong, Taiwan and Canada.

Choice boxed beef cutout value was $4.37 lower Thursday afternoon at $213.56/cwt. Select was $4.00 lower at $204.08.

The average dressed steer weight for the week ending June 6 was 892 lbs., which was 1 lb. heavier than the prior week and 46 lbs. heavier than the same week a year earlier, according to USDA’s Actual Slaughter Under Federal Inspection report. The average dressed heifer weight of 824 lbs. was 2 lbs. lighter than the previous week, but 42 lbs. heavier than the prior year.

Corn futures closed mostly fractionally higher.

Soybean futures closed mostly 1¢ to 2¢ higher. 

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Major U.S. financial indices closed narrowly mixed Thursday. Pressure included more initial weekly jobless claims than traders expected. Initial claims were 1.51 million according to the U.S. Department of Labor; that was 58,000 fewer than the previous week.

The Dow Jones Industrial Average closed 39 points lower. The S&P 500 closed 1 point higher. The NASDAQ closed 32 points higher.

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“Given a potential months-long economic recession, overall beef demand will likely be down even as sit-down restaurants open across the USA,” says Brenda Boetel, Extension livestock economist at the University of Wisconsin-River Falls, in the latest issue of In the Cattle Markets. “Consumers will likely see a small decrease in beef consumption due to the expected decrease in 2020 beef production quantities, but the respective beef demand will likely be down more as consumers will be less willing to pay high prices for beef. The return to U.S. consumers spending large amounts on highly valued beef cuts will be slow and largely dependent on macroeconomic growth. Sit-down restaurants will find creative ways to entice patrons to return, including menu changes with lower price entrees. As such, overall beef demand will likely be down, while demand for higher-valued primals, typically consumed through foodservice, will be down more than the overall beef demand.”

Keep in mind that demand and consumption, though related, are quite different.

Boetel explains consumption is a function of production. As a perishable product, most all beef produced will be consumed. Calculated beef consumption is simply the sum of beef production and beef imports, minus exports and disappearance. She says beef consumption is projected to be 12.5% less in the second quarter of this this year, compared to the same time last year. That has to do with less beef production, spawned by disruptions to beef packing capacity.

Beef demand, on the other hand, reflects consumers’ perceptions of beef in the marketplace and is representative of consumers’ willingness to pay for beef, according to Boetel.

“Beef demand is impacted by several factors including beef prices, as well as prices of alternative proteins such as pork and chicken,” she explains.  “Additionally, income is another determining factor in beef demand, as well as other factors such as tastes and preferences.

“Even though we eat (i.e., consume) the beef produced, it doesn’t mean that beef demand remains in a consistent relationship with production. Beef consumption can increase without an increase in beef demand because beef demand and beef consumption are not the same thing. For example, beef consumption might increase because more beef is produced, but beef demand decreases because consumers are willing to pay less for each pound of beef they do consume.”

Boetel points out the beef demand index calculated at Kansas State University decreased almost 18% for choice retail beef in April of this year, compared to the same time last year. Driving forces included the substantial loss of food service sales, as well as the economic downturn.

Looking ahead, Boetel says many analysts expect global economic growth this year to contract by nearly 3%, while the U.S. economy is expected to contract by nearly 5.7%.

All of that likely means continued overall pressure on cattle prices.

“Until sit-down restaurants are operating at levels prior to COVID, there will likely be differences in the spread between different primals, no matter the amount of cattle processed,” Boetel says. “It will take months for the U.S. processing sector to work through the backlog of cattle on feed, but as it does so, the spread between wholesale beef and live cattle prices will return to traditional levels, although at likely lower absolute price levels for both live cattle and beef due to the macroeconomic downturn.”

Negotiated cash fed cattle prices continued $2-$6 lower on a live basis Wednesday at $100-$102/cwt. in the Southern Plains, mostly $102 in Nebraska; $99-$102 in the western Corn Belt on Tuesday. Dressed trade was at $160-$162, which was $5-$10 lower in Nebraska and steady to $10 lower in the western Corn Belt.

Cattle feeders offered 1,220 head in the weekly Fed Cattle Exchange auction; none sold.

Choice steers and heifers sold $2.25-$2.50 lower at the fat auction in Tama, IA. There were 122 Choice 2-4 steers weighing an average of 1,378 lbs., bringing an average of $104.13/cwt.

Slaughter steers and heifers sold $3-$6 lower at Sioux Falls Regional in South Dakota. There were 498 Choice 3-4 steers weighing an average of 1,533 lbs. and bringing an average of $102.76.

Cattle futures mostly tread water Wednesday amid continued light trade.

Live Cattle futures closed an average of 22¢ higher, except for unchanged in Dec.

Except for 32¢ lower in the back two contracts, Feeder Cattle futures closed an average 36¢ higher. 

Choice boxed beef cutout value was $9.96 lower Wednesday afternoon at $217.93/cwt. Select was $5.09 lower at $208.08.

Corn futures closed mostly fractionally lower.

Soybean futures closed 3¢ to 4¢ higher. 

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Major U.S. financial indices lost recent steam Wednesday, with some likely profit taking and continued uncertainty about COVID-19.

The Dow Jones Industrial Average closed 170 points lower. The S&P 500 closed 11 points lower. The NASDAQ closed 14 points higher.

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“With higher anticipated fed cattle slaughter in 2020, feedlot marketings will increase. A faster pace of marketings and higher forecast fed cattle prices than last month will likely improve feedlot demand for feeder cattle,” say analysts with USDA’s Economic Research Service (ERS), in the latest monthly Livestock, Dairy and Poultry Outlook.

Based on recent price data, ERS increased the projected annual feeder steer price (basis Oklahoma City) by almost $7, compared to the previous month, to $131.40/cwt.

The projected second-quarter feeder steer price was raised by $5 to $126. Forecast price for the third quarter increased $9 to $132. The fourth-quarter price projection rose $13 to $131.

“In the second quarter, the capacity of beef packing plants to slaughter fed cattle was reduced by as much as 41%, which prompted lower prices for fed cattle. As beef production declined, wholesale beef prices skyrocketed, which greatly expanded packer margins. However, as packers’ capacity to slaughter began to rebound at the beginning of May, increasing demand for cattle, it likely increased their willingness to pay higher prices for cattle,” say ERS analysts.

The average five-area direct fed steer price in May was $111.53/cwt. on a live basis, which was more than 9% higher than in April, according to ERS. With that in mind, USDA increased its price forecast for fed steers in the second quarter by $3 to $104. Forecast prices for the third and fourth quarters increased by $6 to $105 and $106, respectively.

“Based on USDA, Agricultural Marketing Service estimated weekly slaughter for the week ending June 13, steer and heifer slaughter recovered to 4% below the same week a year ago, and cow and bull slaughter improved to 7% above the same week last year,” say ERS analysts.

Negotiated cash fed cattle prices continued the early-week’s lower tone through Tuesday afternoon, according to the Direct Slaughter Cattle Dashboard from USDA’s Agricultural Marketing Service. Live steers averaged $102.81/cwt. and live heifers averaged $101.62. In the beef, steers averaged $164.62 and heifers averaged $163.41.

Cattle futures rallied higher on Tuesday, amid relatively light trade, helped along by strength in outside markets, normalizing supply chains and possibly some early positioning ahead of the monthly Cattle on Feed report due out Friday.

Live Cattle futures closed an average of 99¢ higher (25¢ higher in spot Jun to $1.22 higher).

Feeder Cattle futures closed an average $2.03 higher ($1.70 higher in spot Aug to $2.30 higher at the back).

Choice boxed beef cutout value was 72¢ lower Tuesday afternoon at $227.89/cwt. Select was $1.18 lower at $213.17.

Corn futures closed mostly fractionally higher to 1¢ higher.

Soybean futures closed mostly 2¢ lower through Sep ’21 and then mostly unchanged.

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Major U.S. financial indices closed strongly higher Tuesday, buoyed by news of an effective COVID-19 treatment, as well as a record high bounce in domestic retail sales.

Although 6.1% less than a year earlier, retail sales in May of $485.5 billion were a staggering 17.7% more than in April, according to the U.S. Census Bureau.

The Dow Jones Industrial Average closed 526 points higher. The S&P 500 closed 58 points higher. The NASDAQ closed 169 points higher.

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Although consumers moved on from the panic grocery shopping they did in the early stage of COVID-19, they’re keeping up their at-home inventories of foods and beverages. At the end of last month, compared to early April, the estimated number of food and beverage packages on hand in homes declined by only 3%, according to the NPD Group (NPD).

Some consumers are finding it easier to maintain at-home inventories than others.

For the week ending May 28, 68% of U.S. grocery shoppers reported to NPD that they hadn’t encountered any out-of-stock foods and beverages they shopped for during the week. The other 32% of shoppers reported experiencing out-of-stock items that same week, according to NPD’s NET® COVID-19 Pantry & Food Strategy Tracker.

More specifically, 51% of the consumers who reported encountering out of stocks said they weren’t able to purchase the meat or poultry item they were looking for, which was 10% fewer than the previous week.

For perspective, 33% of consumers reported out of stocks of water, coffee, tea, and juice in the week ending May 28 compared to 25% the previous week.

Categories with increased week-to-week out of stocks reported by consumers included fruits, vegetables and potatoes, as well as dairy products.

Still, David Portalatin, NPD food industry advisor says, “Considering the unprecedented situations COVID-19 presented over the last few months, the U.S. food supply chain held up remarkably well.”

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Net cattle feeding returns will be significantly negative through the summer, before improving, according to the latest Historical and Projected Kansas Feedlot Net Returns from Kansas State University.

Keep in mind, the net return projections reflect cash to cash, without any price risk management.

Currently, the net returns projected for steers closed out in May are -$107.72/head with a Feedlot Cost of Gain (FCOG) of $85.38/cwt. Net returns for heifers are projected at -$83.67/head with a FCOG of $91.82.

From there, projected net returns for steers range from -$194.58 per head (Aug.) to -$276.79 (June) with FCOG of $78.30 to $84.16/cwt. For September through February of next year, projected net returns range from -$73.90 (Sept.) to -$13.23 (Feb.) with FCOG ranging from $77.50 (Sept.) to $80.23 (Feb.).

Forecast summer net returns for heifers are similar: -$141.64 (Aug.) to -$240.81 (June) with FCOG of $85.87 (Aug) to $90.54 (June). For September through February of next year, projected net returns range from -$84.71 (Sept.) to -$19.48 (Feb.) with FCOG ranging from $83.54 (Nov.) to $86.29 (Jan.).

Although too few to trend, negotiated cash fed cattle sales started the week on a mostly lower note, with live trades at $100/cwt. in the Texas Panhandle, $98-$100 in Kansas and at $100-$105 in Nebraska. Early dressed trades in Nebraska were at $159-$167; mostly $167 in the western Corn Belt, according to the Agricultural Marketing Service (AMS).

The weighted five-area direct average price for steers last week, on a live basis, was $104.47/cwt., which was $7.92 less than the previous week. The average dressed steer price was $12.64 less at $166.40. Prices for the same week last year were $113.62 and $184.48, respectively.

Cattle futures followed equity markets on Monday, down early before recovering into the close.

Live Cattle futures closed an average of 61¢ higher, except for unchanged in spot Jun.

Feeder Cattle futures closed an average 56¢ higher (7¢ higher in spot Aug to 77¢ higher at the back).

Choice boxed beef cutout value was $2.03 lower Monday afternoon at $228.61/cwt. Select was $4.92 lower at $214.35.

Corn futures closed mostly 1¢ lower.

Soybean futures closed 2¢ to 3¢ lower through Jan ’21 and then mostly 1¢ lower.

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Major U.S. financial indices closed higher Monday, amid a volatile day of trade. Pressure early, tied to resurgent COVID-19 cases in some states, drove indexes sharply lower. The Fed’s announcement that it would buy individual corporate bonds, expanding its support of credit markets, pulled indexes higher, led by tech stocks.

The Dow Jones Industrial Average closed 157 points higher. The S&P 500 closed 25 points higher. The NASDAQ closed 137 points higher.

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“Feeder cattle prices are expected to hold firm through the summer, while feed costs are expected to decline with larger feedstuffs production,” say analysts with the Livestock Market Information Center (LMIC), in the latest Livestock Monitor. “Drought continues to be an aspect to watch. But, with the improvement of fed cattle prices later this year and lower corn costs, cattle feeding margins could become supportive of feeder cattle prices.”

LMIC analysts point out calf and feeder cattle auction volumes were the least for March since 2002 and the least for April since 2012, mirroring significant year-over-year declines in feedlot placements. Through May, however, they say calf and feeder cattle volume marketed via auction, direct and Internet/video was 9.5% more than the same time last year.