Daily Market Highlights

Stronger outside markets and oversold conditions helped Cattle futures extend gains Tuesday.

Feeder Cattle futures closed an average of $1.63 higher (70¢ to $2.32 higher), except for 67¢ lower in spot Nov.

Live Cattle futures closed an average of $1.24 higher.

Depending on which estimates you look at, expectations are for October placements to be about 6% higher year over year, in Friday’s monthly Cattle on Feed report. October marketing are expected to be about 2% less, leaving the on-feed inventory Nov. 1 about 2% higher.

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

Last week, FOB live prices were $181/cwt. in the Texas Panhandle, $180 in Kansas, $181.50 in Nebraska and $178-$180 in the western Corn Belt. Dressed delivered prices were $287 in Nebraska and $283-$287 in the western Corn Belt.

Choice boxed beef cutout value was $2.18 lower Tuesday afternoon at $295.67/cwt. Select was $1.36 lower at $267.88/cwt.

Corn futures closed mostly fractionally higher to 1¢ higher.

KC HRW Wheat closed mostly 2¢ lower.

Soybean futures closed mostly 3¢ to 7¢ higher though Nov ‘25.

******************************

Major U.S. financial indices rallied Tuesday with a cooling inflation reading from the Consumer Price Index.

The Dow Jones Industrial Average closed 489 points higher. The S&P 500 closed 84 points higher. The NASDAQ was up 326 points.

West Texas Intermediate Crude Oil futures (CME) basically unchanged through the front six contracts.

******************************

Winter wheat condition is significantly more positive year over year, according to the latest USDA Crop Progress report for the week ending Nov. 12 — 47% rated Good (39%) or Excellent (8%), compared to 32% a year earlier. On the other end of the scale, 17% was in Poor (10%) or Very Poor (7%) condition. That’s with 93% of the crop in the ground, which was on par with the five-year average.

Corn harvest was 88% complete, which was 4% less than last year but 2% more than the average. As for soybeans, 95% was harvested, compared to 96% a year earlier and 91% for average.

Cattle futures crawled higher Monday.

Feeder Cattle futures closed an average of $1.33 higher.

Live Cattle futures closed an average of 66¢ 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 $4 lower in the Texas Panhandle at $181/cwt., $5 lower in Kansas at $180, $3.50 lower in Nebraska at $181.50 and $5-$7 lower in the western Corn Belt at $178-$180. Dressed delivered prices were $5 lower in Nebraska at $287 and $5-$9 lower in the western Corn Belt at $283-$287.

The weekly weighted average five-area direct fed steer price was $5.88 lower on a live basis at $179.91/cwt. The average price in the beef was $5.78 lower at $286.14.

Choice boxed beef cutout value was $2.61 lower Monday afternoon at $297.85/cwt. Select was $1.82 higher at $269.24/cwt.

Turning to row crops, Soybean futures closed mostly 20¢ to 34¢ higher Monday — dragging the grain complex along —  supported by the South American weather premium and export sales to China. Corn futures closed mostly 10¢ to 13¢ higher. KC HRW Wheat closed 1¢ higher.

******************************

Major U.S. financial indices were little changed Monday.

The Dow Jones Industrial Average closed 54 points higher. The S&P 500 closed 3 points lower. The NASDAQ was down 30 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.06 to $1.09 higher through the front six contracts.

******************************

Although beef cow slaughter is 12.6% less year over year so far this year, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University says the implied culling rate of 12% is more than the long-term average and indicates additional her liquidation.

“Cattle producers are taking advantage of the much stronger cattle prices this fall,” Peel says in his weekly market comments. “In numerous meetings this fall, producers have indicated to me that they are selling the majority of steers and heifers; in part to capitalize on higher prices, and in some cases, because of continuing drought and pasture and hay limitations which are making additional sales necessary.”

Peel notes reported national feeder cattle trade volume (auction, direct and video/internet) is 5.6% more year over year since Labor Day, with the majority in September.

“Taken together, the feeder marketings, feedlot placements and slaughter data all suggest that the industry continues to extract animals from the system in a manner that indicates continued liquidation,” Peel says. “Cattle numbers, generally, will continue to get tighter in 2024. When heifer retention and herd rebuilding begin, cattle numbers will get significantly tighter very quickly.”

Cattle futures stabilized Friday to end a week of massive declines.

Feeder Cattle futures closed an average of $1.50 higher (72¢ to $1.97 higher). Week to week on Friday, they were an average of $13.13 lower ($10.87 to $13.90 lower).

Live Cattle futures closed narrowly mixed, from 25¢ lower to 17¢ higher. Week to week on Friday, they were an average of $9.48 lower ($8.20 to $10.90 lower).

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

For the week, FOB live prices were $4 lower in the Texas Panhandle at $181/cwt., $5 lower in Kansas at $180, $3.50 lower in Nebraska at $181.50 and $5-$7 lower in the western Corn Belt at $178-$180. Dressed delivered prices were $5 lower in Nebraska at $287 and $5-$9 lower in the western Corn Belt at $283-$287.

Choice boxed beef cutout value was $1.04 higher Friday afternoon at $300.46/cwt. Select was $2.00 lower at $267.42/cwt.

Estimated total cattle slaughter last week of 618,000 head was 14,000 fewer than the previous week and 52,000 less than the same week last year. Estimated year-to-date cattle slaughter of 28 million head was 1.4 million head fewer (-4.7%) than the same time last year. Estimated year-to-date beef production of 23 billion pounds was 1.3 billion pounds less (-5.3%).

Turning to row crops, Corn futures closed 2¢ to 4¢ lower. KC HRW Wheat closed 7¢ to 9¢ lower. Soybean futures closed 2¢ to 5¢ higher through May ’24 and then mostly 1¢ to 3¢ lower.

******************************

Major U.S. financial indices closed higher Friday as Treasury yields stabilized.

The Dow Jones Industrial Average closed 391 points higher. The S&P 500 closed 67 points higher. The NASDAQ was up 276 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.22 to $1.43 higher through the front six contracts.

******************************

Potentially, the plateau for wholesale beef prices is etched at approximately $300/cwt., for Choice.

“Since the beginning of June, the wholesale Choice boxed beef price has traded below $300 per hundredweight six days with three of those days occurring this week,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “From 30,000 feet, it appears the market is not willing to move too far from the $300 price point in either direction.”

If that proves to be the case, then it is another clear indicator of domestic consumer demand strength, given the historically high price level. Such a price plateau could also explain why prices have yet to increase as seasonally expected.

“Consumers have been burdened by inflation and rising interest rates, which pulls disposable income towards goods other than beef. Thus, the ability to push beef prices higher will be an uphill battle despite strong beef demand,” Griffith says. “From an economic terms standpoint, the market will most likely see a shift along the demand curve as prices change instead of shifting the demand curve.”

For instance, Griffith points out demand for Prime grading beef remains intact, trading for $30-$40/cwt. more than Choice since the middle of July.

Cattle futures fell hard Thursday. The driving force appeared to be continuation of what began with the bearish Cattle on Feed report last month (lots more placements than anticipated) and the expectation of another negative report this month, tied to the realization supplies will be higher than thought in the shorter term. Likewise, the monthly World Agricultural Supply and Demand Estimates (see below) published on Thursday confirmed expectations of more beef production than previously anticipated.

Feeder Cattle futures closed an average of $7.28 lower ($5.50 to $7.87 lower).

Live Cattle futures closed an average of $4.11 lower ($3.25 to $5.05 lower).

Negotiated cash fed cattle trade was slow on light to moderate demand in all major cattle feeding regions through Thursday afternoon, according to the Agricultural Marketing Service.

In light tests, FOB live prices were mostly $4 lower in the Texas Panhandle at $181/cwt. and mostly $5 lower in Kansas at $180.

Dressed delivered prices in Nebraska were mostly $5 lower at $287. Although too few to trend, there were a few FOB live trades at $181.50, compared to last week’s $185.

There were too few transactions to trend in the western Corn Belt, but there were some FOB live sales at $180 and some in the beef at $283-$287. Prices there last week were $185 and $292, respectively.

Choice boxed beef cutout value was 67¢ higher Thursday afternoon at $299.42/cwt. Select was $1.61 lower at $269.42/cwt.

Soybean and grain futures closed lower, pressured by the World Agricultural Supply and Demand Estimates.

Corn futures closed mostly 5¢ to 8¢ lower.

KC HRW Wheat closed 5¢ to 7¢ lower.

Soybean futures closed 12¢ to 22¢ lower through Sep ’24 and then 8¢ to 10¢ lower.

******************************

Major U.S. financial indices closed lower Thursday on rising bond yields.

The Dow Jones Industrial Average closed 220 points lower. The S&P 500 closed 35 points lower. The NASDAQ was down 128 points.

West Texas Intermediate Crude Oil futures (CME) closed 41¢ to 45¢ higher through the front six contracts.

******************************

USDA’s Economic Research Service (ERS) lowered forecast beef production for this year slightly in the latest World Agricultural Supply and Demand Estimates (WASDE). That stemmed from reduced steer and heifer slaughter offsetting higher expected cow slaughter and higher average dressed weights in the fourth quarter. However, ERS increased forecast beef production for next year by 535 million pounds (+2.1%) compared to the previous month at 25.8 billion pounds. That was based on more expected steer and heifer placements — ultimate marketings — for the remainder of this year and the first part of 2024.

Even so, the forecast weighted annual average five-area direct fed steer price was unchanged for this year at $177.30/cwt. and next year at $185. Prices are forecast at $185 in the first quarter next year, $184 in the second and $182 in the third quarter.

Cattle futures stabilized Wednesday after early pressure and amid strong volume.

Feeder Cattle futures closed an average of $1.52 higher (57¢ to $2.32 higher).

Live Cattle futures closed an average of 82¢ higher (27¢ to $1.05 higher).

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

Last week, FOB live prices were $185/cwt. in all regions and dressed delivered prices were $292.

Choice boxed beef cutout value was $1.63 lower Wednesday afternoon at $298.75/cwt. Select was $1.55 higher at $271.03/cwt.

Soybean and grain futures closed mainly higher ahead of Thursday’s World Agricultural Supply and Demand Estimates.

Soybean futures closed fractionally higher to 3¢ higher through Jly ’24 and then 1¢ lower.

Corn futures closed mostly 4¢ to 7¢ higher.

KC HRW Wheat closed mostly 18¢ to 22¢ higher.

******************************

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

The Dow Jones Industrial Average closed 40 points lower. The S&P 500 closed 4 points higher. The NASDAQ was up 10 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.64 to $2.04 lower through the front six contracts with continued pressure from increasing domestic stocks and a weaker demand outlook.

******************************

U.S. beef exports continue to decline compared to last year’s record totals but showed increasing strength in Western Hemisphere, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF).

September beef exports of 98,757 metric tons (mt), were 15% less year over year and the lowest of 2023. Value declined 12% to $795.5 million. Exports were lower to major Asian destinations but gained momentum in Mexico, Canada, Central America, Colombia and Africa.

For January through September, beef exports were 13% below last year’s record pace in volume (980,100 mt) and down 18% in value ($7.49 billion).

“U.S. beef continues to face tough sledding in our Asian markets, where weakness in major currencies persist and consumer confidence remains guarded,” says Dan Halstom, USMEF president and CEO. “In the past few weeks, we have seen several Asian trading partners step up efforts to stimulate their economies and ease pressure on consumers. In the meantime, bright spots for U.S. beef continue to emerge in the Western Hemisphere, led by strong demand in Mexico.”

Beef export value per head of fed slaughter was $398.73 in September, just 2% less than a year earlier. The January-September average of $396.03 was 15% less than the same time last year.

Although U.S. pork export value and volume were slightly less year over year in September, they maintain a strong pace. Through the first three quarters of this year, pork exports increased 9% year-over-year to 2.13 million mt and climbed 7% in value to just under $6 billion. 

Cattle futures slid further Tuesday with technical pressure and the apparent continued exodus of fund positions. Spot contracts closed at their lowest levels since May (Feeder Cattle) and June (Live Cattle).

Feeder Cattle futures closed an average of $5.48 lower.

Live Cattle futures closed an average of $3.52 lower ($2.55 to $4.00 lower).

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, FOB live prices were $185/cwt. in all regions and dressed delivered prices were $292.

Choice boxed beef cutout value was $1.34 lower Tuesday afternoon at $300.38/cwt. Select was 88¢ lower at $269.48/cwt.

Soybean and grain futures closed lower with likely profit taking and positioning ahead of Thursday’s World Agricultural Supply and Demand Estimates.

Soybean futures closed mostly 7¢ to 10¢ lower.

Corn futures closed mostly 4¢ to 8¢ lower.

KC HRW Wheat closed mostly 10¢ to 13¢ lower.

******************************

Major U.S. financial indices continued higher Tuesday, led by tech stocks.

The Dow Jones Industrial Average closed 56 points higher. The S&P 500 closed 12 points higher. The NASDAQ was up 121 points.

West Texas Intermediate Crude Oil futures (CME) closed $3.14 to $3.45 lower through the front six contracts.

******************************

Agricultural producer sentiment improved slightly month to month, according to the Purdue University/CME Group Ag Economy Barometer. It rose 4 points to a reading of 110 in October. The Index of Current Conditions rose 3 points to 101 while the Index of Future Expectations rose 5 points to 114.

“Farmers in this month’s survey were slightly less concerned about the risk of lower prices for crops and livestock and felt somewhat better about their farms’ financial situation than a month earlier,” says James Mintert, the barometer’s principal investigator and director of Purdue University’s Center for Commercial Agriculture.

The Farm Financial Performance Index rose 6 points in October, reflecting producers’ increasing optimism about their operations’ financial performance compared to the previous month.

“Reports of higher-than-expected corn and soybean yields in some Corn Belt locations, along with a modest rally in corn prices, likely contributed to this month’s rise in the financial conditions and the barometer indices,” Mintert explains.

This month’s Ag Economy Barometer survey was conducted from October 16-20, 2023.

Cattle futures gapped lower Monday with apparent nervousness about the inability of boxed beef prices to catch a strong seasonal grip and chatter about declining long fund positions.

Feeder Cattle futures closed an average of $3.39 lower.

Live Cattle futures closed an average of $2.64 lower.

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 steady to $1 higher in the Southern Plains at $185/cwt., Prices in the North were also $185, at the upwards end of the previous week’s trading range. Dressed delivered prices were $2 higher at $292.

Choice boxed beef cutout value was 62¢ lower Monday afternoon at $301.72/cwt. Select was $1.65 lower at $270.36/cwt.

Turning to row crops, Soybean futures closed 11¢ to 13¢ higher through Aug ‘24  Monday with follow-through support from bearish weather forecasts in South America.

Corn futures closed mostly unchanged to fractionally higher.

KC HRW Wheat closed mostly 1¢ to 2¢ higher.

******************************

Major U.S. financial indices edged higher Monday with follow-through support from last week’s steamy gains.

The Dow Jones Industrial Average closed 34 points higher. The S&P 500 closed 7 points higher. The NASDAQ was up 40 points.

West Texas Intermediate Crude Oil futures (CME) closed 31¢ to 63¢ higher through the front six contracts.

******************************

Domestic consumer beef demand continues strong despite historically high prices.

In fact, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University says post-pandemic beef demand has been exceptional since 2021 with per capita beef consumption last year of 58.9 pounds, which was equal to 2021.

Moreover, in his weekly market comments, Peel points out inflation-adjusted retail all-fresh beef prices were record high in 2021 and just slightly lower in 2022. By way of comparison, he notes the all-fresh beef price in 2015 was similar to 2021-22 but per capita beef consumption back then was 8.3% less at 54.0 pounds.

So far this year, Peel says retail all-fresh beef prices continue increasing and reached a new record monthly high in September at $7.82 per pound.

“There are certainly plenty of macroeconomic and geopolitical uncertainties to keep the industry nervous about beef demand,” Peel says. “However, the increasingly high quality and consumer preferences for beef continue to be reflected in strong beef demand. These factors, combined with tightening beef supplies, will keep wholesale and retail beef prices strongly supported in the coming months.”

Cattle futures closed lower Friday on likely profit taking and week-end positioning.

Feeder Cattle futures closed an average of $1.74 lower (80¢ to $2.42 lower). However, they were an average of $3.89 higher week to week ($3.45 to $5.02 higher).

Live Cattle futures closed an average of 59¢ lower on Friday (37¢ to $1.20 lower). They gained back a lion’s share of the previous week’s losses, closing an average of $3.19 higher week to week on Friday ($1.65 higher at the front to $3.92 higher at the back).

Soybean futures rallied Friday on bearish weather reports in South America, leading Corn and Wheat futures higher.

Soybean futures closed 19¢ to 24¢ higher through Nov ‘24 and then 10¢ to 17¢ higher.

Corn futures closed mostly 5¢ to 7¢ higher.

KC HRW Wheat closed mostly 2¢ higher.

Negotiated cash fed cattle trade ranged from slow on light to moderate demand to a standstill through Friday afternoon, according to the Agricultural Marketing Service.

Although too few to trend, there were some FOB live prices at $185/cwt. in Nebraska and the western Corn Belt, and a few dressed delivered at $292.

The previous week, FOB live prices were $185/cwt. in the Southern Plains, $183-$186 in Nebraska and mostly $183-$184 in the western Corn Belt. Dressed delivered prices were $290.

Choice boxed beef cutout value was $2.19 lower Friday afternoon at $302.34/cwt. Select was $2.33 lower at $272.01/cwt.

Estimated total cattle slaughter last week was 4,000 head fewer than the previous week at 632,000 head, which was 32,000 head fewer year over year. Estimated total year-to-date cattle slaughter of 27.4 million was 1.3 million head fewer (-4.6%). Estimated year-to-date beef production of 22.5 billion pounds was 1.2 billion pounds less (-5.2%) than the same time last year.

******************************

Major U.S. financial indices extended gains with fewer month-to-month employment gains than expected.

Total nonfarm employment increased by 150,000 in October, leaving the unemployment rate little changed at 3.9%. Average hourly earnings for all employees on private nonfarm payrolls rose by 7¢ to $34.00. Over the past 12 months, average hourly earnings have increased by 4.1%.

The Dow Jones Industrial Average closed 222 points higher. The S&P 500 closed 40 points higher. The NASDAQ was up 184 points.

West Texas Intermediate Crude Oil futures (CME) closed $1.57 to $1.95 lower through the front six contracts.

******************************

USDA’s Economic Research Service (ERS) forecasts total cash labor expenses for U.S. agriculture at $43.35 billion this year. That would be 1.8% more than last year.

“The projected 2023 level would remain below the high set in 2017 in inflation-adjusted labor expenses,” say ERS analysts. “… For every $100 spent on production expenses, almost $10 goes toward labor. Total labor expenses include contract and hired labor payments but exclude non-cash employee compensation.”

Feeder Cattle led Live Cattle futures higher Thursday, supported by renewed trader interest, recently oversold conditions and stronger outside markets.

Feeder Cattle futures closed an average of $3.93 higher.

Live Cattle futures closed an average of $1.43 higher.

Negotiated cash fed cattle trade was at a standstill in all major cattle feeding regions through Thursday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.

Last week, FOB live prices were $185/cwt. in the Southern Plains, $183-$186 in Nebraska and $183-$185 in the western Corn Belt. Dressed delivered prices were $290.

Choice boxed beef cutout value was $2.35 higher Thursday afternoon at $304.53/cwt. Select was $4.21 lower at $274.34/cwt.

Net U.S. beef export sales of 17,100 metric tons for 2023, for the week ending Oct. 26, were 2% less than the previous week, but 71% more than the prior four-week average. Increases were primarily for China, Japan, Taiwan, South Korea and Canada.

Corn futures closed 2¢ to 5¢ lower through Sep ‘24 and then mostly fractionally lower.

KC HRW Wheat closed mostly 2¢ higher.

Soybean futures closed 11¢ to 13¢ higher through Sep ‘24 and then 9¢ higher.

******************************

Major U.S. financial indices rallied higher Thursday with increasing investor confidence the Fed may be done raising interest rates this year. Declining Treasury Note yields and weaker labor data underscored the optimism.

Unit labor costs of nonfarm labor decreased 0.8% in the third quarter, according to the U.S. Department of Labor. As well, weekly initial unemployment insurance claims increased 5,000 to 217,000, which was more than expected.

The Dow Jones Industrial Average closed 564 points higher. The S&P 500 closed 79 points higher. The NASDAQ was up 232 points.

West Texas Intermediate Crude Oil futures (CME) closed $2.01 to $2.07 higher through the front six contracts.

******************************

Drought conditions continue to improve nationwide, according to the latest U.S. Drought Monitor. As of Oct. 31, 36.5% of the continental United States was enduring one degree of drought or another, compared to 62.8% a year earlier, but 28.1% three months earlier.

Snubbed to a different post, 37% of the nation’s cattle were in areas affected by drought Oct. 31, compared to 76% a year earlier.

However, drought lingers and expands in some areas. According to the latest weekly USDA Crop Progress report for the week ending Oct. 29, the states with 50% or more of pasture and range rated as Poor or Very Poor included: Kansas (55%), Louisiana (61%), Minnesota (52%), Mississippi (61%), Missouri (52%), Oregon (50%), South Carolina (52%), Texas (62%) and Washington (69%).

As for row crops, 71% of corn was in the bin compared to 74% a year earlier and 66% for average. Similarly, 85% of soybeans were harvested, which was 2% less year over year but 7% more than the five-year average.

Cattle futures closed higher Wednesday amid growing open interest and thoughts cash fed cattle prices will gain this week.

Feeder Cattle futures closed an average of 88¢ higher (57¢ to $1.27 higher).

Live Cattle futures closed an average of 71¢ higher (7¢ to $1.20 higher).

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

Last week, FOB live prices were $185/cwt. in the Southern Plains, $183-$186 in Nebraska and $183-$185 in the western Corn Belt. Dressed delivered prices were $290.

Choice boxed beef cutout value was $3.00 lower Wednesday afternoon at $302.18/cwt. Select was 95¢ lower at $278.55/cwt.

Corn futures closed 1¢ to 3¢ lower. KC HRW Wheat closed mostly 5¢ to 8¢ higher. Soybean futures closed mostly 1¢ to 4¢ higher.

******************************

Major U.S. financial indices continued higher Wednesday, buoyed by the Fed’s decision to hold interest rates steady.

The Dow Jones Industrial Average closed 221 points higher. The S&P 500 closed 44 points higher. The NASDAQ was up 210 points.

West Texas Intermediate Crude Oil futures (CME) closed 24¢ to 58¢ lower through the front six contracts. 

******************************

Recent heavy moisture is propping up wheat pasture prospects in key states.

For instance, in Oklahoma, Darrell Peel, Extension livestock marketing specialist at Oklahoma State University says, “In recent extension meetings, many producers have indicated that they expect to have wheat pasture, if somewhat later than usual, in many cases. Some producers have already purchased stockers, betting on the come, while others will be in the market now.”

Wheat planting overall is running about even with the five-year average, according to the most recent weekly Crop Progress report — 84% planted and 64% emerged. Condition is running ahead of last year with 47% rated Good and Excellent and 18% rated Poor and Very Poor.

“Current cash and futures prices imply a value of gain from November 1 to early March of about $1.50/lb. for a 475-lb. stocker steer,” Peel explains, in his most recent weekly market comments. “Depending on specific cost assumptions, this is about equal to the breakeven for winter grazing, providing returns to wheat pasture and labor but nothing beyond that for the cattle. If Feeder Cattle futures rebound somewhat, as I expect, there may be better opportunities to lock in additional returns in the coming weeks.”

Moreover, Peel says stocker calf prices are unlikely to show any seasonal weakness in the coming weeks, given fewer calves available year over year and stronger wheat pasture demand.