Weekly Market Highlights

Cattle Current Weekly Highlights—Week ending June 14, 2019

Despite futures pressure stemming from higher grain prices, cash feeder cattle mostly gained, perhaps with increased demand as more feedlots get cleaned up.

Steers and heifers sold steady to $5/cwt. higher, according to the Agricultural Marketing Service (AMS).

“Demand was reported as moderate to good across the Northern and Southern Plains as buyers were willing to put cattle back in pens even with the uptick in corn prices,” note AMS analysts. 

Feeder Cattle futures closed an average of $1.90 lower week to week on Friday ($1.55 to $2.45 lower). Over the same period, Corn futures closed an average of 34¢ higher through the front three contracts, as weather challenges both planted acres and yield.

“Steer and heifer calf prices are now expected to fall by about 3% in 2019 relative to last year, equivalent to taking between $4-$7/cwt. out of 500-600 lb. calf prices in the Southern Plains,” say analysts with the Livestock Marketing Information Center (LMIC), in the latest Livestock Monitor. They peg the season-average corn price at $4.50/bu.

In his weekly market comments, Andrew P. Griffith, agricultural economist at the University of Tennessee points out Dec Corn futures are up a staggering 80¢ since the middle of May.

“The market is already pricing corn in such a way to ration its use over the next 12-15 months,” Griffith explains. “Understanding that fewer acres of corn have been planted this year and yields are expected to be negatively impacted by later planting, fewer bushels of corn will pressure cattle markets the next 12 months as corn prices remain elevated.”

At the same time, Griffith points out the excessive moisture challenging row crops is fueling forage growth.

“…feedlots will be looking for heavier cattle to place in the feedlot which means there will be incentive to add weight to cattle the next several months,” Griffith says.

Fed Cattle Soften in Sluggish Trade

Neither cattle feeders nor packers seemed possessed to swap cattle.

Negotiated cash fed cattle trade for the week appeared steady to either side of even in two regions through Friday afternoon. The only established prices reported by USDA during the week were for the western Corn Belt: mainly steady on a live basis at $114-$115/cwt. and steady to $2 higher in the beef at $184-$186. There were prices reported in other regions at mostly $1-$2 lower than the previous week but too few to trend. On Friday, the Texas Cattle Feeders Association reported its members trading at $112, which was $1 less than the previous week.

Both carcass weights and grading percentages continue to suggest that feedlot marketing is current, with no backlog building in the wings.

Live Cattle futures closed mixed week to week on Friday: an average of $1.08 higher through the front four contracts (52¢ to $1.85 higher) and then an average of 40¢ lower, except for 20¢ higher at the back.

In the latest World Agricultural Supply and Demand Estimates (WASDE), USDA analysts forecast $118/cwt. for the 5-area Direct fed steer price in the second quarter, followed by $110 in the third quarter and $114 in the fourth.

Year to date, AMS notes that heifer slaughter rate is 8.7% more than last year, with beef cow slaughter up 2.6%, perhaps suggesting further pressure on limited herd expansion.

“Preliminary heifer slaughter through May is about 50,000 head short of 4 million head,” say AMS analysts. “The last time January-to-May heifer slaughter eclipsed the 4 million mark was 2011.”

Choice boxed beef cutout value was 8¢ lower week to week on Friday afternoon at $222.23/cwt. Select was $4.16 lower at $202.76.

“Weaker beef demand may be the biggest threat to cattle and beef markets for the remainder of the year,” explained Derrell Peel, Extension livestock marketing specialist, in his weekly market comments. “Strong beef demand supported cattle and beef markets in 2017 and 2018, but there are signs that some weakness may be developing in beef demand in both domestic and international markets. While unemployment remains very low, other indications of weakness in the macro-economy are concerning and have led to reduced forecasts for U.S. economic growth in 2019; largely due to ongoing impacts of tariffs and trade disruptions. Relatively slow domestic income growth and higher prices for major consumer items, such as gasoline, combined with record large supplies of beef, pork and poultry may be limiting domestic beef demand going forward in 2019.”

Friday to Friday Change*

Weekly Auction Receipts

Receipts

June 14

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

134,900

(-29,100)

52,900

(+22,600)

49,400

(+37,300)

237,200

(+30,800)

 

CME Feeder Index

CME Feeder Index* June 13 Change
  $134.25 + 2.38

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash June 14 Change
600-700 lbs. $163.77 +  $10.35
700-800 lbs. $148.06 +  $4.87
800-900 lbs. $135.86 +  $1.83

 

South Central

Steers-Cash June 14 Change
500-600 lbs. $156.38 +  $1.61
600-700 lbs. $146.89 +  $1.14
700-800 lbs. $136.54 +  $1.76

 

Southeast

Steers-Cash June 14 Change
400-500 lbs. $153.77 +  $2.22
500-600 lbs. $143.51 –   $0.10
600-700 lbs. $132.83 –   $0.62

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) June 14 ($/cwt) Change
Choice $222.23 –   $0.08
Select $202.76 –   $4.16  
Ch-Se Spread $19.47 +  $4.08

 

Futures

Feeder Cattle  June 14 Change
Aug $135.525 –  $1.725
Sep $135.800 –  $1.550
Oct $135.750 –  $1.625
Nov $135.875 –  $1.475
Jan ’20 $133.850 –  $1.975
Mar $133.075 –  $2.350
Apr $134.475 –  $2.025
May $134.750 –  $2.450

 

Live Cattle   June 14 Change
Jun $108.775 + $1.850
Aug $104.275 + $0.975
Oct $105.475 + $0.975
Dec $109.950 + $0.525
Feb ’20 $114.100 – $0.075
Apr $116.175 – $0.300
Jun $108.925 – $0.750
Aug $107.525 – $0.475
Oct $110.000 + $0.200

 

Corn futures June 14 Change
Jul $4.530 + $0.374
Sep $4.582 + $0.340
Dec $4.634 + $0.298
Mar ’20 $4.674 + $0.250
May $4.684 + $0.228
Jul $4.6.80 + $0.198

 

Oil CME-WTI June 14 Change
Jul $52.51 –  $1.48
Aug $52.77 –  $1.39
Sep $52.95 –  $1.32
Oct $53.00 –  $1.25
Nov $53.01 –  $1.18
Dec $52.98 –  $1.12

 

Equities

Equity Indexes June 14 Change
Dow Industrial Average  26089.61 + 105.67
NASDAQ     7796.66 +   54.56
S&P 500     2886.98 +   13.64
Dollar (DXY)          97.45 +    0.89
Cattle Current Weekly Highlights—Week ending June 14, 2019 2019-06-16T14:36:13-05:00

Cattle Current Weekly Highlights—Week ending June 7, 2019

Calf and Feeder Prices Continue Lower

Despite some recovery in Cattle futures, increasing beef production, trade tensions and grain price uncertainty continued to weigh on cash calf and feeder cattle markets.

Nationwide, steers and heifers sold $1-$5/cwt. lower, according to the Agricultural Marketing Service (AMS).

“Market reporters noted this week’s offerings were feeling the effects of the first hot spell of the year,” say AMS analysts. “Auction receipts lagged behind a year ago by 50,000 as analysts are scrutinizing the number of placements in May and June due to the unusually large placement number in April.”

Feeder Cattle futures recovered about 27% of the previous week’s steep losses, closing an average of $2.41 higher week to week on Friday (80¢ higher toward the back to $4.12 higher in spot Aug). That was thanks to strong gains Tuesday and Wednesday as Corn futures softened.

Corn futures closed an average of 11¢ lower through the front three contracts week to week on Friday. Keep in mind, the previous two weeks they were up an average of22¢higher through the front six contracts.

Monday’s Crop Progress report will likely drive near-term direction. The previous week, corn planting was record slow with just 67% of in the ground as of June 2, which was 29% less than last year and the 5-year average. Planting was even slower in most key corn states.

“Higher expected corn prices due to the inability to get corn planted is definitely a factor weighing negatively on the feeder cattle market, as are continued trade tensions,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “However, there are factors in the marketplace that should benefit the beef and cattle complex, including African Swine Fever, which is reducing the quantity of meat protein on the global market.”

Griffith also points to the easing of trade tensions with some nations, such as Canada and Mexico.

Recently threatened U.S. tariffs on Mexico—due to the flow of illegal immigrants through that nation—reportedly were suspended on Friday. If so, perhaps that paves the way for ratification of the U.S.-Mexico-Canada trade agreement.

In the meantime, the lack of trade deals continues to weigh on U.S. beef exports.

U.S. beef exports totaled 105,241 mt in April, down 5% year over year and export value was down only slightly at $674.2 million, according to data released by USDA and compiled by the USMEF.

Beef export value per head of fed slaughter in April averaged $305.61, which was 7% less than a year earlier.

Fed Cattle Prices Soften

Negotiated cash fed cattle trade ended up generally $2-$3 lower on a live basis last week at $112-$113/cwt. in the Southern Plains and at $114-$115 in Nebraska and the western Corn Belt. Dressed trade was also $2-$3 lower at $183-$184.

Except for $1.55 lower in spot Jun, Live Cattle futures closed an average of $1.06 higher week to week on Friday (22¢ to $1.57 higher).

“The story in the finished cattle market continues to be the strong basis where live cash prices are trading $5-$6 higher than June Live Cattle futures,” Griffith says. “For cattle feeders that hedged the sale of these cattle prior to April 23, the positive basis is a money-making proposition as the futures hedge will have protected against the huge futures price decline, and cattle feeders are capturing the value in the positive basis. At the same time, the positive basis provides good reason to stay current with marketings, which will keep pulling cattle through the system.”

So far, grading percentages and carcass weights suggest fed cattle marketing remains aggressive and current.

Although carcass quality in May was higher year over year with an average of 78.36% grading Choice and Prime, the average was 1.86% less month to month—compared to a decline of 0.84% the previous year.

As for carcass weights, after catching up and surpassing year-over-year levels for several weeks, average dressed steer weights sunk to 842 lbs. the week ending May 25, the lightest of the year. Though a seasonal decrease is unsurprising, dropping 7 lbs. from the previous week and 6 lbs. from the previous year speaks to heavy, timely marketing.

“Despite some good gains in Cattle futures, the previous week’s sharp break and plentiful supplies, with seasonal weakness coming for the summer months, still paints a bearish attitude,” say AMS analysts.

Friday to Friday Change*

Weekly Auction Receipts

Receipts

June 7

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

164,000

(+72,800)

30,300

(+7,900)

12,100

(-6,000)

206,400

(+74,700)

 

CME Feeder Index

CME Feeder Index* June 6 Change
  $131.87 –  0.60

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash June 7 Change
600-700 lbs. $153.42 –   $7.85
700-800 lbs. $143.19 –   $3.54
800-900 lbs. $134.03 –   $5.65

 

South Central

Steers-Cash June 7 Change
500-600 lbs. $154.77 –   $4.22
600-700 lbs. $145.75 –   $1.88
700-800 lbs. $134.78 –   $2.77

 

Southeast

Steers-Cash June 7 Change
400-500 lbs. $151.55 +  $3.17
500-600 lbs. $143.61 –   $1.03
600-700 lbs. $133.45 –   $1.47

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) June 7 ($/cwt) Change
Choice $222.31 –   $0.90
Select $206.92 –   $0.77  
Ch-Se Spread $15.39 –   $0.13

 

Futures

Feeder Cattle  June 7 Change
Aug $137.250 + $4.125
Sep $137.350 + $3.275
Oct $137.375 + $2.850
Nov $137.350 + $2.350
Jan ’20 $135.825 + $2.175
Mar $135.425 + $2.650
Apr $136.500 + $0.800
May $137.200 + $1.025

 

Live Cattle   June 7 Change
Jun $106.925 – $1.550
Aug $103.300 + $0.225
Oct $104.500 + $0.600
Dec $109.425 + $0.950
Feb ’20 $114.175 + $1.400
Apr $116.475 + $1.400
Jun $109.675 + $1.575
Aug $108.000 + $1.325
Oct $109.800 + $0.975

 

Corn futures June 7 Change
Jul $4.156 –  $0.114
Sep $4.242 –  $0.118
Dec $4.336 –  $0.100
Mar ’20 $4.424 –  $0.090
May $4.456 –  $0.070
Jul $4.482 –  $0.054

 

Oil CME-WTI June 7 Change
Jul $53.99 + $0.49
Aug $54.16 + $0.52
Sep $54.27 + $0.54
Oct $54.25 + $0.53
Nov $54.19 + $0.53
Dec $54.10 + $0.55

 

Equities

Equity Indexes June 7 Change
Dow Industrial Average  25983.94 + 1168.90
NASDAQ     7742.10 +  288.95
S&P 500     2873.34 +   121.28
Dollar (DXY)          96.56 –       1.05
Cattle Current Weekly Highlights—Week ending June 7, 2019 2019-06-09T15:20:02-05:00

Cattle Current Weekly Highlights—Week ending May 31, 2019

Widespread heavy rain and flooding continued to mire crop planting, increase price uncertainty and weigh heavy on feeder cattle markets.

Nationwide, the Agricultural Marketing Service (AMS) pegged cash prices for steers and heifers at steady money to $5/cwt. lower, amid receipts curtailed by both Memorial Day and continued severe weather.

AMS analysts noted that last week’s heavy rains will test levees and dams in South Dakota, Nebraska, Kansas, Oklahoma, Arkansas, Missouri and Illinois. 

At the same time, high water levels continue to test and disrupt transportation.

One example.

“Commercial navigation on the McClellan-Kerr Arkansas River Navigation System (MKARNS) is being disrupted due to high waters,” explains Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “MKARNS provides inland ports that connect directly to the Mississippi river as far inland as the Port of Catoosa, near Tulsa. The MKARNS is an important transportation artery for agriculture in a multi-state region, providing a market for grain shipments downstream and the arrival of inputs such as fertilizer.”

Crop Uncertainty Pummels Feeder Cattle Futures

Softer cash prices for calves and feeders felt more severe, given the collapse in futures prices over the week’s last two sessions.

Feeder Cattle futures closed an average of $8.80 lower week to week on Friday ($6.37 lower to $10.10 lower in spot Aug). Plenty of the pressure stemmed from

the extraordinary increase in grain futures prices, tied to growing uncertainty about this year’s crop production.

“Corn planting progress is the slowest on record for this time of year and soybean acreage planted is reported to be the second slowest on record,” say AMS analysts.

Just 58% of corn was planted as of May 26, according to the most recent USDA Crop Progress report. That was 32% less than last year and 32% less than the 5-year average. 32% was emerged, which was 37% less than last year and 37% less than average. Progress was even more bearish in some key states, compared to average: Illinois (-60%);  Indiana (-63%); Iowa (-20%); Minnesota (-27%); Nebraska (-13%).

Corn futures closed an average of 22¢higher through the front six contracts week to week on Friday. That’s an average of 42¢ higher in the last two weeks.

Similarly, only 29% of soybeans were in the ground, compared to 74% for the previous year and 66% for the average. 11% were emerged, which was 33% less than last year and 24% less than average.

Soybean futures were about 48¢higher week to week on Friday, through the front six contracts. They’re up an average of 56¢over the last two weeks.

“The four remaining feeder cattle futures contracts for 2019 as well as the four feeder cattle contracts trading in the first half of 2020 are all trading in less than a $2 range,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Maybe today’s futures market quotes are correct in predicting the future cash price for the next 12 months, but it seems highly unlikely that feeder cattle will continue to trade in such a narrow range.”

Cattle futures were also pressured by news Friday that President Trump plans to impose 5% tariffs on Mexican imports, beginning June 10, unless that country makes significant progress toward stemming the flow of illegal immigrants across its northern border into the U.S. Should that come to pass, the move also casts a shadow over ratification of the U.S.-Mexico-Canada trade agreement.

Live Cattle futures closed an average of $3.45 lower week to week on Friday ($2.67 to $4.87 lower).

Fed Cattle Prices Steady

Negotiated cash fed cattle trade ended the week mainly steady with the previous week on a live basis at $115 in the Southern Plains, $116 in Nebraska and mostly $116-$117 in the western Corn Belt. Dressed trade was steady to $3 higher at $186 in Nebraska and at $185-$187 in the western Corn Belt.

“There is no definitive way to know what halted the finished cattle price collapse in the cash market, but something came to the aid of cattle feeders,” Griffith says. “Finished cattle continue to trade with a positive basis which is desirable for anyone on the selling side of a transaction. However, the June Live Cattle contract is trading around $110 and the expectation would be to see convergence of the futures contract price and the cash price.”

In the latest Livestock Monitor, analysts with the Livestock Marketing Information Center forecasts average fed steer prices in the third quarter (July-September) at $112-$115/ cwt., about 3% more year over year.

In the meantime, despite increasing beef production, wholesale beef values continue to trade steady to higher.

Choice boxed beef cutout value was $1.57 higher week to week on Friday afternoon at $223.21/cwt. Select was 78¢ lower at $207.69.

Friday to Friday Change*

Weekly Auction Receipts

Receipts

May 31

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

91,200

(-39,100)

22,400

(-22,900)

18,100

(+17,100)

131,700

(-44,900)

 

CME Feeder Index

CME Feeder Index* May 30 Change
  $132.47 –  4.34

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash May 31 Change
600-700 lbs. $172.48 +  $1.81
700-800 lbs. $161.27 –   $0.34
800-900 lbs. $146.73 –   $2.91

 

South Central

Steers-Cash May 31 Change
500-600 lbs. $158.99 –   $5.07
600-700 lbs. $147.63 –   $7.89
700-800 lbs. $137.55 –   $8.93

 

Southeast

Steers-Cash May 31 Change
400-500 lbs. $148.38 –   $6.41
500-600 lbs. $144.64 –   $1.15
600-700 lbs. $134.92 +  $0.35

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) May 31 ($/cwt) Change
Choice $223.21 +  $1.57
Select $207.69 –   $0.78  
Ch-Se Spread $15.52 +  $2.35

 

Futures

Feeder Cattle  May 31 Change
Aug $133.125 –  $10.100
Sep $134.075 –  $9.800
Oct $134.525 –  $9.700
Nov $135.000 –  $9.850
Jan ’20 $133.650 –  $9.225
Mar $132.775 –  $8.950
Apr $135.700 –  $6.375
May $136.175 –  $6.425

 

Live Cattle   May 31 Change
Jun $108.475 –   $2.700
Aug $103.075 –   $4.875
Oct $103.900 –   $3.875
Dec $108.475 –   $3.625
Feb ’20 $112.775 –   $3.450
Apr $115.075 –   $3.175
Jun $108.100 –   $3.350
Aug $106.675 –   $3.325
Oct $108.825 –   $2.675

 

Corn futures May 31 Change
Jul $4.270 + $0.228
Sep $4.350 + $0.236
Dec $4.436 + $0.240
Mar ’20 $4.514 + $0.222
May $4.526 + $0.204
Jul $4.536 + $0.192

 

Oil CME-WTI May 31 Change
Jul $53.50 –  $5.13
Aug $53.64 –  $5.07
Sep $53.73 –  $5.00
Oct $53.72 –  $4.94
Nov $53.66 –  $4.87
Dec $53.55 –  $4.80

 

Equities

Equity Indexes May 31 Change
Dow Industrial Average  24815.04 –   770.65
NASDAQ     7453.15 –   183.86
S&P 500     2752.06 –     74.00
Dollar (DXY)          97.61 +      0.01
Cattle Current Weekly Highlights—Week ending May 31, 2019 2019-06-01T18:40:03-05:00

Cattle Current Weekly Highlights—Week ending May 24, 2019

Volatile futures markets and continued pressure from increasing beef production weighed on cattle prices last week. Widespread heavy rain and flooding also hampered and altered calf and feeder cattle marketing.

“Soggy, waterlogged soils are prevalent throughout much of the country and is a far cry from a year ago when the drought monitor had over 25% of the country in a D1 moderate drought designation or worse,” say analysts with the Agricultural Marketing Service (AMS). “Swollen rivers have made transportation of goods up the Mississippi, Ohio and Missouri almost non-existent.” 

Nationwide, AMS pegged calf and feeder cattle prices from $3/cwt. lower to $4 higher, with stronger prices later in the week.

Feeder Cattle futures closed an average of $2.63 lower week to week on Friday, with added pressure from rising feed costs.

Only 49% of corn was planted as of May 19, according to the most recent USDA Crop Progress report, which was 29% less than last year and 31% less than the 5-year average. Corn futures closed an average of 20¢ higher through the front six contracts week to week on Friday.

First-quarter prices for feeder steers (700-800 lbs.) in the Southern Plains were $5.76/cwt. less (-3.9%) year over year, according to the Livestock Marketing Information Center (LMIC). Steer calf (500-600 lbs.) prices were down $8.60 (-4.8%). Those analysts expect second-quarter prices to be about 1% higher than last year.

The monthly Cattle on Feed report could offer some support, with about 4.5% fewer April placements than expected, though still 8.67% higher year over year.

Fed Cattle Prices Continue Lower

Negotiated cash fed cattle trade through Friday afternoon last week was generally $1-$2 lower on a live basis at $114-$115/cwt. in the Southern Plains and $116 in Nebraska. It was steady in the western Corn Belt at $116-$118. Dressed trade was steady to $2 lower in Nebraska at $183-$186; steady to $4 lower in the western Corn Belt at $185-$186.

“Despite lower prices in the finished cattle market for the fifth consecutive week, feedlot operators were willing sellers, in order to continue capturing the positive basis,” explains Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “The cash market price has declined $13 over that five-week period, making it difficult to see the bottom of this price decline. This week’s cash trade resulted in the lowest finished cattle price since November of last year, and should raise a warning sign as the market moves through the soft summer months. The strong downward price movement could be pointing the market toward a weekly summer low near $106/cwt., but the hope will be to hold the line near $110, which will probably be close to the average price for June through August.”

Except for 10¢ and 40¢ lower at either end of the board, Live Cattle futures closed $1.21 lower week to week on Friday.

Wholesale beef values edged higher, though, offering hope that summer grilling demand may finally be at hand.

Choice boxed beef cutout value was $1.33 higher week to week on Friday afternoon at $221.64/cwt. Select was 19¢ higher at $208.47.

As well, beef in freezers as of  Apr. 30 totaled 430.35 million lbs. That was 5% less (-40.8 million lbs.) than the previous month and 9% less than the previous year, according to the monthly USDA Cold Storage report published Wednesday. That’s also well below the five-year average of 457 million lbs., according to Allendale, Inc.

Added bullishness from frozen inventory comes with understanding how much beef production began to surge in April.

Beef production in April of 2.26 billion lbs. was 143.8 million lbs. (+6.79%) more than the previous year, according to the monthly USDA Livestock Slaughter report. That was on total federally inspected cattle slaughter of 2.79 million head, which was 189,700 head (+7.30%) more.

For January through April, beef production of 8.67 billion lbs. was 91.7 million lbs. (+1.07%) more year over year. That was on 10.60 million head of cattle slaughtered under federal inspection, which was 248,600 head (+2.40%) more than a year earlier.

Friday to Friday Change*

Weekly Auction Receipts

Receipts

May 24

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

130,300

(-18,600)

45,300

(+16,200)

1,000

(-15,500)

176,600

(-17,900)

 

CME Feeder Index

CME Feeder Index* May 23 Change
  $136.81 +  4.05

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash May 24 Change
600-700 lbs. $170.67 –   $2.98
700-800 lbs. $161.61 +  $2.85
800-900 lbs. $149.64 +  $1.27

 

South Central

Steers-Cash May 24 Change
500-600 lbs. $164.06 –   $0.33
600-700 lbs. $155.52 +  $3.30
700-800 lbs. $146.48 +  $8.47

 

Southeast

Steers-Cash May 24 Change
400-500 lbs. $154.79 –   $4.65
500-600 lbs. $145.79 –   $5.00
600-700 lbs. $134.57 –   $6.50

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) May 24 ($/cwt) Change
Choice $221.64 +  $1.33
Select $208.47 +  $0.19  
Ch-Se Spread $13.18 +  $1.14

 

Futures

Feeder Cattle  May 24 Change
Aug $143.225 –  $2.275
Sep $143.875 –  $2.825
Oct $144.225 –  $3.100
Nov $144.850 –  $2.950
Jan ’20 $142.875 –  $2.700
Mar $141.725 –  $1.950
Apr $142.075 –  $2.625
May $142.600 n/a

 

Live Cattle   May 24 Change
Jun $111.175 –   $0.100
Aug $107.950 –   $0.975
Oct $107.775 –   $1.125
Dec $112.100 –   $1.450
Feb ’20 $116.225 –   $1.725
Apr $118.250 –   $1.250
Jun $111.450 –   $0.700
Aug $110.000 –   $1.250
Oct $111.500 –   $0.400

 

Corn futures May 24 Change
Jul $4.042 + $0.210
Sep $4.124 + $0.220
Dec $4.196 + $0.214
Mar ’20 $4.292 + $0.216
May $4.322 + $0.190
Jul $4.344 + $0.162

 

Oil CME-WTI May 24 Change
Jul $58.63 –  $4.29
Aug $58.71 –  $4.28
Sep $58.73 –  $4.25
Oct $58.66 –  $4.20
Nov $58.53 –  $4.13
Dec $58.35 –  $4.04

 

Equities

Equity Indexes May 24 Change
Dow Industrial Average  25585.69 –   178.31
NASDAQ     7637.01 –   179.28
S&P 500     2826.06 –     33.47
Dollar (DXY)          97.60 –       0.41
Cattle Current Weekly Highlights—Week ending May 24, 2019 2019-05-25T19:35:23-05:00

Cattle Current Weekly Highlights—Week ending May 17, 2019

Cattle and beef markets continued to erode on seasonal pressure, weather delays and bearishness concerning looming heavy beef production.

Nationwide, steers and heifers sold steady to $5/cwt. lower, with instances of as much as $8 lower, according to the Agricultural Marketing Service (AMS).

Feeder Cattle futures closed an average of $1.46 lower week to week on Friday (95¢ to $3.10 lower in spot May). That was with a surge of about $3.40 higher during the last two sessions, except for spot May.

“It is not surprising to see the lightweight calf market begin to soften as the market begins to move towards late spring and early summer. However, it is disconcerting to watch yearling cattle prices soften during this same time period when they typically begin seeing support,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments.

However, Griffith points out current Feeder Cattle futures prices are only $8-$12 below the trading range from late October to the middle of March.

“During this entire time period, cash feeder cattle prices never surged higher nor did they have a washout. People actually making a living with cattle have continued trading on a flat market with little change in price the past seven months,” Griffith says.

Based on recent prices and pressure on feedlot economics, analysts with USDA’s Economic Research Service (ERS) lowered the expected feeder steer price (Oklahoma City) by $2 for the second quarter to $145/cwt. In the monthly Livestock, Dairy and Poultry Outlook, ERS projects the annual feeder steer price for this year at $145.50.

In his weekly market comments,Derrell Peel, Extension livestock marketing specialist at Oklahoma State University says he expects prices to increase seasonally for heavy feeder cattle as feedlot pen conditions improve.

One potential snag in that outlook could be higher feed prices if planting continues to be delayed by wet, cool weather. As of May 12, only 30% of corn was planted, according to the USDA Crop Progress report. That was 29% less than last year and 36% less than the 5-year average.

Corn futures closed an average of 23¢higher through the front six contracts week to week on Friday (13¢higher to 31¢higher in spot Jul).

Fed cattle Prices Lose More Ground

Negotiated cash fed cattle trade was $3-$5 lower last week on a live basis at $115-$117/cwt. in the Southern Plains, $117 in Nebraska and $116-$118 in the western Corn Belt. Dressed prices were $2-$5 lower in the western Corn Belt at $185-$190 and $3-$10 lower in Nebraska at $185-$186.

“The positive basis has been the motivating factor for most feedlot managers to push cattle out of the feedlot, even though they would prefer to hold the line on cash-traded cattle,” Griffith explains. “The current week’s cash trade is still resulting in a $6 positive basis, but the expectation is for this to be whittled away over the next month. It would appear the finished cattle market is now in a situation where things are going to get worse before they start to get better.”

Live Cattle futures closed mixed week to week on Friday, from 10¢ to $1.17 lower in three contracts, to an average of 61¢ higher (2¢ to $1.32 higher).

The slow start to grilling season continues to weigh on beef prices.

Choice boxed beef cutout value was 80¢ lower week to week on Friday afternoon at $220.31/cwt. Select was 82¢ higher at $208.28.

“It is almost certain that Choice beef has hit its 2019 high and there is a real possibility that Choice boxes will test the $200 mark,” Griffith says. “It may take some additional bad news to push prices below $200, but it could occur. Similarly, the Choice Select spread has been seasonal, but the spread is nearly $10 lower than the widest spread a year ago which hints toward supply and demand of Choice versus Select beef.”

Friday to Friday Change*

Weekly Auction Receipts

Receipts

May 17

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

148,900

(+2,100)

29,100

(+7,800)

16,500

(-6,200)

194,500

(+3,700)

 

CME Feeder Index

CME Feeder Index* May 16 Change
  $132.76 –   2.76

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash May 17 Change
600-700 lbs. $173.65 n/a
700-800 lbs. $158.76 n/a
800-900 lbs. $148.37 n/a

 

South Central

Steers-Cash May 17 Change
500-600 lbs. $164.39 n/a
600-700 lbs. $152.22 n/a
700-800 lbs. $138.01 n/a

 

Southeast

Steers-Cash May 17 Change
400-500 lbs. $159.44 n/a
500-600 lbs. $150.79 n/a
600-700 lbs. $141.07 n/a

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) May 17 ($/cwt) Change
Choice $220.31 –   $0.80
Select $208.28 +  $0.82  
Ch-Se Spread $12.03 –   $1.62

 

Futures

Feeder Cattle  May 17 Change
May $134.525 –  $3.100
Aug $145.500 –  $1.325
Sep $146.700 –  $1.075
Oct $147.325 –  $1.425
Nov $147.800 –  $1.550
Jan ’20 $145.575 –  $1.100
Mar $143.675 –  $1.125
Apr $144.700 –  $0.950

 

Live Cattle   May 17 Change
Jun $111.275 –   $1.175
Aug $108.925 +  $0.025
Oct $108.900 –   $0.125
Dec $113.550 +  $0.475
Feb ’20 $117.950 +  $1.200
Apr $119.500 +  $1.325
Jun $112.150 +  $0.150
Aug $111.250 +  $0.500
Oct $111.900 –   $0.100

 

Corn futures May 17 Change
Jul $3.832 + $0.316
Sep $3.904 + $0.294
Dec $3.982 + $0.262
Mar ’20 $4.076 + $0.214
May $4.132 + $0.172
Jul $4.182 + $0.136

 

Oil CME-WTI May 10 Change
Jun $62.76 + $1.10
Jul $62.92 + $1.12
Aug $62.99 + $1.13
Sep $62.98 + $1.15
Oct $62.86 + $1.16
Nov $62.66 + $1.17

 

Equities

Equity Indexes May 17 Change
Dow Industrial Average  25764.00 –   178.37
NASDAQ     7816.29 –   100.65
S&P 500     2859.53 –     21.87
Dollar (DXY)          98.01 +       0.69
Cattle Current Weekly Highlights—Week ending May 17, 2019 2019-05-18T15:56:43-05:00

Cattle Current Weekly Highlights—Week ending May 10, 2019

Cattle markets continued to erode last week, pressured by everything from volatile outside markets whipsawed by kneejerk trade emotion, to the cool weather delaying summer grilling demand, to increasing fed cattle supplies.

Nationwide, steers and heifers sold steady to $5/cwt. lower, with instances of $10 lower, according to the Agricultural Marketing Service (AMS).

“Rain and waterlogged fields were the main talk across the breadbasket of the country as cattle receipts were hampered from Kansas to the Dakotas to Illinois and Indiana,” AMS analysts say.

A late-week rally helped Feeder Cattle futures close and average of 89¢ higher week to week on Friday (45¢ to $1.27 higher). The previous two weeks, Feeder Cattle slid about an average of $14 lower.

Oversold conditions and the significant decline in open interest offer hope the rally in Cattle futures represents a turn from the bottom.

“Feeder cattle prices in the cash market moving through summer and fall are now on course to remain steady with the previous six months, given the expectations of Feeder Cattle futures,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Though the past three weeks of futures trading have not been advantageous for folks marketing feeder cattle, there is still time for the market to recover some of its losses. One can never predict prices with 100% certainty, but there may be an opportunity that summer and fall Feeder Cattle futures prices move back to the low $150s which will present a marketing opportunity.”

Moreover, it appears grain prices will remain supportive.

Bearishness Prevails in Grain Markets

Despite wet conditions and late planting that threaten to decrease corn planting,Corn futures were an average of 16¢lower week to week on Friday, through the front six contracts (18¢to 21¢lower). Friday’s monthly World Agricultural Supply and Demand Estimates (WASDE) offered no support.

For instance, analysts with USDA’s Economic Research Service (ERS) projected the 2019-20 season-average farm price for corn 20¢ lowerat $3.30/bu., the lowest since 2006-07.

Likewise, in the latest WASDE, ERS analysts say, “The projected season-average farm price for wheat is $4.70/bu., down from last year’s estimated $5.20 on the expectation of greater export competition and lower U.S. corn prices.”

As for soybeans, WASDE projects the 2019-20 U.S. season-average price at $8.10/bu., down 45¢ from the previous year.

Soybean futures were down about 31¢on average week to week, through the front six contracts.

Fed Cattle Prices Continue Decline

Negotiated cash fed cattle trade continued to lose ground last week. Live sales were $2.00-$4.50 lower at $120/cwt. in the Southern Plains, mostly $121 in Nebraska and $122.00-$122.50 in the western Corn Belt. Dressed trade was $6-$11 lower in Nebraska at $189-$194. It was $8-$10 lower in the western Corn Belt at $190-$192.

“A $6 (per cwt.) loss in two weeks adds up to about $84 per head on an animal finishing at 1,400 lbs.,” Griffith explains. “There is good reason cattle feeders have been willing sellers at lower prices. That reason is the June Live Cattle futures price, which is trading at a $7-$8 discount to this week’s cash price. Cattle feeders are likely wanting to push even more cattle out of pens to keep from being forced to market those cattle on an even lower market than this week.”

Live Cattle futures closed mixed week to week on Friday, from an average of 54¢ lower (10¢ to 97 lower) to an average of 19¢ higher. They were down by about $9 on average the previous two weeks.

As mentioned earlier, cool, wet weather continues to stymie the seasonal increase in grilling demand.

Choice boxed beef cutout value was $6.25 lower week to week on Friday afternoon at $221.11/cwt. Select was $5.83 lower at $207.46.

Although upcoming holidays should offer an expected seasonal boost, cattle numbers and carcass weights are increasing. After months of lower year-over-year dressed steer and heifer weights, they began to draw even and then increase a couple of weeks ago. The average dressed steer weight of 854 lbs. (week ending Apr. 27) was 4 lbs. heavier than the previous year, according to USDA’s Actual Slaughter Under Federal Inspection report. Average dressed heifer weights were 6 lbs. heavier at 794 lbs. Fed cattle slaughter for the same week was 14,665 head more at 512,477.

USDA didreduce beef production slightly for this year, in the latest WASDE. The May projection is 27.27 billion lbs., which would be 397 million lbs. more than last year.

“Beef production is forecast higher primarily on higher projected steer and heifer slaughter and heavier carcass weights,” according to ERS analysts.

Although slightly lower month to month, WASDE projects higher fed cattle prices year over year. The annual average fed steer price was projected at $118.50/cwt., compared to $117.12 last year. Prices are forecast at $121 in the second quarter, $113 in the third quarter and $114 in the fourth quarter.

Friday to Friday Change*

Weekly Auction Receipts

Receipts

May 10

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

134,200

(-73,700)

21,300

(-30,300)

22,700

(-15,300)

178,200

(-119,300)

 

CME Feeder Index

CME Feeder Index* May 9 Change
  $135.52 –   5.66

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash May 10 Change
600-700 lbs. n/a n/a
700-800 lbs. n/a n/a
800-900 lbs. n/a n/a

 

South Central

Steers-Cash May 10 Change
500-600 lbs. n/a n/a
600-700 lbs. n/a n/a
700-800 lbs. n/a n/a

 

Southeast

Steers-Cash May 10 Change
400-500 lbs. n/a n/a
500-600 lbs. n/a n/a
600-700 lbs. n/a n/a

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) May 10 ($/cwt) Change
Choice $221.11 –   $6.25
Select $207.46 –   $5.83  
Ch-Se Spread $13.65 –   $0.42

 

Futures

Feeder Cattle  May 10 Change
May $137.625 + $0.475
Aug $146.825 + $0.450
Sep $147.775 + $0.625
Oct $148.750 + $0.975
Nov $149.350 + $1.100
Jan ’20 $146.675 + $1.275
Mar $144.800 + $1.025
Apr $145.650 + $1.225

 

Live Cattle   May 10 Change
Jun $112.450 –   $0.975
Aug $108.900 –   $0.250
Oct $109.025 –   $0.650
Dec $113.075 –   $0.500
Feb ’20 $116.750 +  $0.100
Apr $118.175 +  $0.175
Jun $112.000 +  $0.250
Aug $110.750 +  $0.250
Oct $112.000 –   $0.350

 

Corn futures May 10 Change
May $3.424 –  $0.206
Jul $3.516 –  $0.190
Sep $3.610 –  $0.166
Dec $3.720 –  $0.156
Mar ’20 $3.862 –  $0.134
May $3.960 –  $0.104

 

Oil CME-WTI May 10 Change
Jun $61.66 –  $0.28
Jul $61.80 –  $0.24
Aug $61.86 –  $0.21
Sep $61.83 –  $0.18
Oct $61.70 –  $0.16
Nov $61.49 –  $0.15

 

Equities

Equity Indexes May 10 Change
Dow Industrial Average  25942.37 –   562.58
NASDAQ     7916.94 –   247.06
S&P 500     2881.40 –     64.24
Dollar (DXY)          97.32 –        0.13
Cattle Current Weekly Highlights—Week ending May 10, 2019 2019-05-12T15:00:13-05:00

Cattle Current Weekly Highlights—Week ending May 3, 2019

Bearishness continued in cattle markets as futures prices dropped and cash prices eroded.

Nationwide, steers and heifer sold from steady to $7/cwt. lower, according to the Agricultural Marketing Service (AMS). There were instances of $10-$12 lower for lightweight steers.

“Grass cattle demand has subsided as ranchers are taking stock of what is going on in Chicago,” say AMS analysts. “CME cattle futures continued to close in the red this week and all market participants are standing up and taking notice…The loss of $100 per head or more on a 750 lb. steers in the matter of two weeks makes one wonder just what the heck is going on fundamentally.”

Likewise, the AMS reporter on hand for Thursday’s Superior Livestock Video auction noted, “There is limited demand for feeders. Demand for lightweight cattle headed to grass is moderate as grass accounts are pretty much full…Some producers chose to pass at current bids.”

Feeder Cattle futures closed an average of $6.73 lower week to week on Friday. That’s an average of $13.88 lower in the last two weeks.

However, weekly weighted average prices for calves and feeders remained higher year over year in the North Central region, according to USDA’s National Weekly Feeder and Stocker Cattle Summary. Compared to the same week a year earlier, prices were about even in other regions.

Fed Cattle Prices Continue Slide

Negotiated cash fed cattle prices were sharply lower for the week. Live trade was $3-$4 lower at $122-$123/cwt. in the Southern Plains; mostly $124 in Nebraska and $123-$127 in the western Corn Belt. Dressed trade was mainly $4-$6 lower at mostly $200. It’s worth noting that fed cattle prices remain higher year over year.

AMS analysts noted that estimated fed cattle trade (5-area) for the week of approximately 125,000 head would be the most since late October in 2018.

“The next 60 days are when some of the best meat consumption occurs in the U.S. and we will see how much is needed to satisfy our markets, both domestic and abroad,” say AMS analysts.

Live Cattle futures closed an average of $3.48 lower week to week on Friday. That’s an average of $9.27 lower in the last two weeks.

“The June Live Cattle contract price has declined $8 in the past two weeks, with the August and October contracts trading $4 lower than the June contract,” explains Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “If this price decline is realized, the market will have declined 14.6% from its spring high to its summer low, which is only slightly higher than the seasonal 13-14% that is normally experienced. Some may question the expectation of the price decline due to cattle on feed numbers or other factors, but the market has a way of balancing based on supply and demand.”

Choice boxed beef cutout value was $5.63 lower week to week on Friday afternoon at $227.36/cwt. Select was $6.12 lower at $213.29.

Griffith points out the Choice cutout value traded higher year over year every week so far this year, except for one.

“One should be able to say with certainty that the strength in the cutout price has supported the finished cattle market despite the 1.9% increase in total cattle slaughter, which means the average weekly slaughter is nearly 12,000 head higher than the same period in 2018,” Griffith explains. “The increase in slaughter numbers through the first 17 weeks of the year are from heifers and cows. Even with 198,000 additional head in the slaughter mix thus far, domestic beef production over that time is only 0.7% higher than a year ago or 56.4 million lbs. more. The ability of packers to push the Choice cutout price higher than year-ago levels with additional beef on the market would point to strong beef demand.”

Friday to Friday Change*

Weekly Auction Receipts

Receipts

May 3

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

207,900

(+14,000)

51,600

(-21,700)

38,000

(+36,700)

297,500

(+29,000)

 

CME Feeder Index

CME Feeder Index* May 2 Change
  $141.18 –   3.06

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash May 3 Change
600-700 lbs. $178.78 n/a
700-800 lbs. $164.66 n/a
800-900 lbs. $153.14 n/a

South Central

Steers-Cash May 3 Change
500-600 lbs. $170.28 n/a
600-700 lbs. $156.59 n/a
700-800 lbs. $142.46 n/a

Southeast

Steers-Cash May 3 Change
400-500 lbs. $168.29 n/a
500-600 lbs. $158.63 n/a
600-700 lbs. $144.92 n/a

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) May 3 ($/cwt) Change
Choice $227.36 –   $5.63
Select $213.29 –   $6.12  
Ch-Se Spread $14.07 +  $0.49

 

Futures

Feeder Cattle  May 3 Change
May $137.150 –  $6.800
Aug $146.375 –  $6.475
Sep $147.150 –  $6.700
Oct $147.775 –  $6.700
Nov $148.250 –  $6.625
Jan ’20 $145.400 –  $6.775
Mar $143.775 –  $6.675
Apr $144.425 –  $7.125

 

Live Cattle   May 3 Change
Jun $113.425 –   $1.625
Aug $109.150 –   $3.500
Oct $109.675 –   $3.750
Dec $113.575 –   $3.900
Feb ’20 $116.650 –   $3.725
Apr $118.000 –   $3.725
Jun $111.750 –   $3.850
Aug $110.500 –   $3.800
Oct $112.350 n/a

 

Corn futures May 3 Change
May $3.630 + $0.118
Jul $3.706 + $0.094
Sep $3.776 + $0.082
Dec $3.876 + $0.070
Mar ’20 $3.996 + $0.042
May $4.064 + $0.020

 

Oil CME-WTI May 3 Change
Jun $61.94 –  $1.36
Jul $62.04 –  $1.34
Aug $62.07 –  $1.29
Sep $62.01 –  $1.22
Oct $61.86 –  $1.18
Nov $61.64 –  $1.16

 

Equities

Equity Indexes May 3 Change
Dow Industrial Average  26504.95 –     38.38
NASDAQ     8164.00 +     17.60
S&P 500     2945.64 +       5.76
Dollar (DXY)          97.45 –        0.60
Cattle Current Weekly Highlights—Week ending May 3, 2019 2019-05-04T17:23:36-05:00

Cattle Current Weekly Highlights—Week ending Apr. 26, 2019

Bearishness returned to cattle markets last week, tied to the hard fall in Cattle futures, borne by increasing pessimism about looming cattle supplies as some funds began to unwind long positions. Added pressure came from volatility in Lean Hog futures.

Even so, steers and heifers sold from $3 lower to $4/cwt. higher according to the Agricultural Marketing Service (AMS).

“Many markets from early to mid week were on the higher side, while later in the week markets followed the CME cattle complex in a downward trend,” say AMS analysts. They explain demand continued for summer turnout cattle as many auctions begin transitioning to summer schedules.

Feeder Cattle futures closed and average of $7.15 lower on Friday, compared to the previous Thursday ($3.80 lower at the back to $8.22 lower).

“…a downward movement in feeder cattle futures this week does not mean the market will continue to decline or stay at its current level,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “There are fundamental aspects of the market that could support the summer and fall contract months moving north of $160. However, the previous statement is not a solicitation to remain idle with a hope that the market will make a run. Producers should be considering their marketing alternatives and the cost of achieving their marketing objective.”

Fed Cattle Sell Steady to Lower

When all was said done last week, negotiated cash fed cattle prices were steady in the Southern Plains at $126/cwt., but $2-$3 less in the north at $125-$127 in Nebraska and $128 in the western Corn Belt. Dressed trade was $2-$3 lower at mostly $205 in Nebraska and mostly $205-$206 in the western Corn Belt.

Live Cattle futures closed an average of $5.79 lower on Friday, compared to the previous Thursday ($3.97 lower in spot Apr to $7.62 lower).

“It has been difficult the past two weeks to fully understand what is happening in the finished cattle market,” Griffith says. “The April contract, which will soon be pushed to the wayside, steadily increased from the low $120s to about $130 from November through the middle of March. Since that time, the contract moved from $126 to $128 and then declined to $124, all in a matter of two weeks. Similarly, the cash finished cattle market has moved in a similar pattern with no definitive reason for the gyrations. Maybe the Cattle on Feed report was an influencing factor or maybe it is a broader market signal related to demand. Either way, the market appears to have some uncertainty as is evident in the futures market. This does present opportunities.”

So far, weather-depressed carcass weights are helping support cattle prices in the face of growing numbers.

The average dressed steer weight in March was 11 lbs. less year over year at 867 lbs., according to USDA’s monthly Livestock Slaughter report. For January-March it was 8 lbs. less at 878 lbs. Average dressed heifer weight was 13 lbs. less year over year at 807 lbs. in March. It was 11 lbs. less for January to March at 817 lbs.

Cattle numbers will continue to increase as carcass weights catch up to normal.

For perspective, AMS analysts note that cattle slaughter through the middle of April of approximately 9.1 million head was 1% more than last year and 0.6% more than the three-year average. For the same period, steer slaughter was 3.5% less than last year and 3.6% less than the 3-year average, while heifer slaughter was 7.7% more than last year and 5.7% more than the three-year average.

Choice boxed beef cutout value was 66¢ lower week to week on Friday afternoon at $232.99/cwt. Select was $1.08 lower at $219.41.

“Boxed beef values have been doing very well but started to find some resistance this week as packers have plenty of product to sell,” say AMS analysts. 

As well, Griffith points out U.S. beef and veal exports were 4.2% less year over year through the first two months of 2019.

Friday to Friday Change*

Weekly Auction Receipts

Receipts

Apr. 26

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

193,900

(-5,500)

73,300

(-13,100)

1,300

(-44,100)

268,500

(-62,700)

 

CME Feeder Index

CME Feeder Index* Apr. 25 Change
  $144.24 –   1.87

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Apr. 26 Change
600-700 lbs. n/a n/a
700-800 lbs. n/a n/a
800-900 lbs. n/a n/a

South Central

Steers-Cash Apr. 26 Change
500-600 lbs. n/a n/a
600-700 lbs. n/a n/a
700-800 lbs. n/a n/a

Southeast

Steers-Cash Apr. 26 Change
400-500 lbs. n/a n/a
500-600 lbs. n/a n/a
600-700 lbs. n/a n/a

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Apr. 26 ($/cwt) Change
Choice $232.99 –   $0.66
Select $219.41 –   $1.08  
Ch-Se Spread $13.58 +  $0.42

 

Futures

Feeder Cattle  Apr. 26 Change
May $143.950 –  $7.575
Aug $152.850 –  $7.825
Sep $153.850 –  $8.225
Oct $154.475 –  $7.925
Nov $154.875 –  $7.300
Jan ’20 $152.175 –  $7.475
Mar $150.450 –  $7.050
Apr $151.550 –  $3.800

 

 

Live Cattle   Apr. 26 Change
Apr $124.550 –   $3.975
Jun $115.050 –   $7.625
Aug $112.650 –   $7.100
Oct $113.425 –   $6.675
Dec $117.475 –   $6.400
Feb ’20 $120.375 –   $5.700
Apr $121.725 –   $5.175
Jun $115.600 –   $4.700
Aug $114.300 –   $4.750

 

 

Corn futures Apr. 26 Change
May $3.512 –  $0.072
Jul $3.612 –  $0.060
Sep $3.694 –  $0.056
Dec $3.806 –  $0.056
Mar ’20 $3.954 –  $0.048
May $4.044 –  $0.038

 

 

Oil CME-WTI Apr. 26 Change
May $63.30 –  $0.77
Jun $63.38 –  $0.74
Jul $63.36 –  $0.75
Aug $63.23 –  $0.78
Sep $63.04 –  $0.79
Oct $62.80 –  $0.78

 

Equities

Equity Indexes Apr. 26 Change
Dow Industrial Average  26543.33 –     16.21
NASDAQ     8146.40 +  148.34
S&P 500     2939.88 +    34.85
Dollar (DXY)          98.05 +      0.60
Cattle Current Weekly Highlights—Week ending Apr. 26, 2019 2019-04-27T16:56:04-05:00

Cattle Current Weekly Highlights—Week ending Apr. 19, 2019

Grass demand continued to fuel calf and feeder cattle prices, with steers and heifers trading $2-$7/cwt. higher—steers $10-$14 higher in Nebraska and South Dakota—according to the Agricultural Marketing Service (AMS).

“The most gain on steers would be the ‘grass crazy’ demand as some producers held off purchasing steers under 650 lbs. that are suitable for grass until warmer weather was imminent,” say AMS analysts. “Demand at most auctions nationwide was described from good to very good as out-of-state buyers showed up where they hadn’t been seen for a while. Feedlot pens in the Northern Plains have dried considerably and farmer-feeders came to town to procure cattle before they become swamped with planting spring crops.”

Continued optimism in Lean Hog futures and strengthening wholesale beef values helped lift Cattle futures for the week; Futures markets were closed on Friday.

Week to week on Thursday, except for 27¢ higher in spot Apr, Feeder Cattle futures closed an average of $2.49 higher ($1.67 to $3.02 higher).

There could be some early-week pressure, in response to the monthly Cattle on Feed report that was issued after futures markets closed on Thursday.

March placements (+4.84%) and total cattle on feed (+2.00%) were more than average analysts expectations ahead of the report.

“One thing that analysts will be looking at in future months is the amount of wheat pasture cattle that will be moving in May,” say AMS analysts. 

Cash Fed Cattle Prices Higher

When all was said and done, negotiated cash fed cattle trade ended up $2 higher in the Southern Plains at $126/cwt. on a live basis, and steady to $4 higher in Nebraska and the western Corn Belt at mostly $130. Dressed trade was $2-$4 higher at $208.

Week to week on Thursday, Live Cattle futures closed an average of $2.00 higher ($1.50 higher at the back to $2.52 higher in spot Apr).

Week to week on Friday, Choice boxed beef cutout value was $4.81 higher at $233.65/cwt.—the highest level since June of 2017. Select was 53¢ lower at $220.49.

“With the box beef cutout increasing in value each day, packers have increased the need for cattle,” say AMS analysts. Fed cattle slaughter weights continue to trend below year ago levels as the hard winter in the North took a toll on weight gains.” 

The average dressed steer weight for the week ending Apr. 6 was 865 lbs., which was 7 lbs. less than a year earlier, according to USDA’s Actual Slaughter Under Federal Inspection report. The average dressed heifer weight was 5 lbs. less at 804 lbs.

In his weekly market comments, Andrew P. Griffith, agricultural economist at the University of Tennessee points out the low drop credit continues to drag on prices.

“The steer by-product price is currently trading just over $9/cwt., which is one of the lowest values dating back to 2009,” Griffith says. “This compares to the 2011 through 2014 time period when the drop value ranged from about $12.50 to $16.50/cwt. Thus, a 1,300-pound steer in today’s market would return about $117 per head while a $14 price would return $182 per head. To say the least, the drop credit is negatively influencing finished cattle prices compared to the past few years and there is little to no sign of the market exiting its poor condition.”

Friday to Friday Change*

Weekly Auction Receipts

Receipts

Apr. 19

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

 

199,400

(+9,200)

86,400

(+32,600)

45,400

(-27,400)

331,200

(+14,400)

 

CME Feeder Index

CME Feeder Index* Apr. 17 Change
  $145.01 +  1.66

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Apr. 19 Change
600-700 lbs. n/a n/a
700-800 lbs. n/a n/a
800-900 lbs. n/a n/a

South Central

Steers-Cash Apr. 19 Change
500-600 lbs. n/a n/a
600-700 lbs. n/a n/a
700-800 lbs. n/a n/a

Southeast

Steers-Cash Apr. 19 Change
400-500 lbs. $170.17 +  $2.82
500-600 lbs. $160.22 +  $1.21
600-700 lbs. $146.05 +  $1.94

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Apr. 19 ($/cwt) Change
Choice $233.65 +  $4.81
Select $220.49 –   $0.53  
Ch-Se Spread $13.16 +  $5.34

 

Futures

Feeder Cattle  Apr. 18 Change
Apr $145.700 + $0.275
May $151.525 + $1.675
Aug $160.675 + $3.025
Sep $162.075 + $2.975
Oct $162.400 + $3.000
Nov $162.175 + $2.950
Jan ’20 $159.650 + $2.125
Mar $157.500 + $1.700

 

 

Live Cattle   Apr. 18 Change
Apr $128.525 +  $2.525
Jun $122.675 +  $2.250
Aug $119.750 +  $2.375
Oct $120.100 +  $1.650
Dec $123.875 +  $1.825
Feb ’20 $126.075 +  $2.200
Apr $126.900 +  $2.050
Jun $120.300 +  $1.600
Aug $119.050 +  $1.500

 

 

Corn futures Apr. 18 Change
May $3.584 –  $0.016
Jul $3.672 –  $0.014
Sep $3.750 –  $0.016
Dec $3.862 –  $0.022
Mar ’20 $4.002 –  $0.020
May $4.082 –  $0.018

 

 

Oil CME-WTI Apr. 18 Change
May $64.00 + $0.42
Jun $64.07 + $0.40
Jul $64.12 + $0.39
Aug $64.11 + $0.42
Sep $64.01 + $0.43
Oct $63.83 + $0.45

 

Equities

Equity Indexes Apr. 18 Change
Dow Industrial Average  26559.54 +  416.49
NASDAQ     7998.06 +    50.70
S&P 500     2905.03 +    16.71
Dollar (DXY)          97.45 +     0.29
Cattle Current Weekly Highlights—Week ending Apr. 19, 2019 2019-04-21T17:16:07-05:00

Cattle Current Weekly Highlights—Week ending Apr. 12, 2019

“Feeder calves and stocker calves under 800 lbs., especially those carrying a minimal amount of flesh, showed the way with the best demand,” according to analysts with the Agricultural Marketing Service (AMS). “Buyers continue to shy away from cattle carrying too much flesh condition for their weight.”

Overall, AMS pegged the price trend for steers and heifers at $2/cwt. lower to $2 higher.

Week to week on Friday, except for 72¢ lower in spot Apr, Feeder Cattle futures closed an average of $1.49 higher (27¢ to $3.27 higher at the back).

Weather-delayed forage growth and cattle finishing appear to be capping demand currently.

Lighter Carcass Weights Remain Supportive

 With the latest widespread storm, AMS analysts say, “There is bound to be more weight loss of nearly-finished cattle throughout the Northern Plains. Just how much was lost will be evident in the coming months as calf-feds get closer to harvest. Currently, cattle are not meeting their projected out-weights and cost of gains are higher than anticipated just a few months ago.”

The average dressed steer weight was 7 lbs. lighter than a year earlier at 865 lbs., according to USDA’s Actual Slaughter Under Federal Inspection report for the week ending Mar. 31. The average dressed heifer weight was 8 lbs. lighter at 806 lbs. Fed steer and heifer slaughter was 16,070 head more at 480,913 head. Total cattle slaughter for the week of 618,707 head was 28,320 head more. Beef production was 15.8 million lbs. more (+3.3%) at 496.7 million lbs.

USDA’s Economic Research Service (ERS) reduced expected beef production for this year to 27.280 billion lbs. (-20 million lbs.) in the latest World Agricultural Supply and Demand Estimates (WASDE).

“The beef production forecast is reduced from the previous month, primarily on lower carcass weights, but higher total cattle slaughter for 2019 is expected to partially offset declines in carcass weights,” say ERS analysts.

Projected WASDE fed steer prices (5-area Direct) were lowered slightly based on a lower price in the first quarter. The 5-area Direct fed steer price is projected at $122-$126/cwt. in the second quarter; $111-$119 in the third and $109-$119 in the fourth.

Pork Potential Adds Lift

Through late Friday afternoon, based on USDA reports, the only trendable negotiated cash fed cattle trade for the week was steady money in the Southern Plains at $124/cwt.

Week to week on Friday, Live Cattle futures closed an average of 90¢ higher.

“The beef market is inching ever closer to grilling season and the unofficial start of summer that comes with Memorial Day weekend grilling. One might surmise that this should provide some support in the near term, but it may take the passing of Easter before interest in beef begins to soar,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Market participants should also consider that feedlots will become more interested in filling pen space as favorable weather conditions become more evident and as wet pens dry. In some instances, it appears the market is priming the pump to make a run.”

Week to week on Friday, Choice boxed beef cutout value was $1.91 higher at $228.84/cwt. Select was 74¢ higher at $221.02.

If Lean Hog futures are any indication, then more beef price support could emerge based on expectations of improved international pork demand, stemming from African Swine Fever in China and Southeast Asia.

Rabobank expects Chinese pork production losses of 25% to 35% this year. Analysts there note the loss is at least 30% larger than annual U.S. pork production and nearly as large as Europe’s annual pork supply.

Rabobank also expects production losses to exceed 10% in Vietnam, the world’s fifth largest pork-producing country and a significant supplier to China.

Friday to Friday Change*

Weekly Auction Receipts

Receipts

Apr. 12

Auction (head)

(change)

Direct

(head)

(change)

Video-Net (head)

(change)

Total

(head)

(change)

190,400

(-42,800)

53,800

(-38,200)

72,800

(+70,800)

317,000

(-10,200)

CME Feeder Index

CME Feeder Index* Apr. 11 Change
$142.78 –  1.23

*Thursday-to Thursday for CME Feeder Index

Cash Stocker and Feeder

North Central

Steers-Cash Apr. 12 Change
600-700 lbs. $169.07 +  $1.59
700-800 lbs. $154.15 –   $0.06
800-900 lbs. $142.03 –   $1.34

South Central

Steers-Cash Apr. 12 Change
500-600 lbs. n/a n/a
600-700 lbs. n/a n/a
700-800 lbs. n/a n/a

Southeast

Steers-Cash Apr. 12 Change
400-500 lbs. $159.01 –   $7.78
500-600 lbs. $144.11 –   $14.42
600-700 lbs. $132.27 –   $12.24

(AMS National Weekly Feeder & Stocker Cattle Summary)

Wholesale Beef Value

Boxed Beef  (p.m.) Apr. 12 ($/cwt) Change
Choice $228.84 +  $1.91
Select $221.02 +  $0.74  
Ch-Se Spread $7.82 +  $1.17

Futures

Feeder Cattle  Apr. 12 Change
Apr $145.425 –  $0.725
May $150.500 + $0.275
Aug $158.700 + $1.975
Sep $159.775 + $1.550
Oct $159.750 + $0.775
Nov $159.575 + $0.750
Jan ’20 $157.300 + $1.825
Mar $155.450 + $3.275
Live Cattle   Apr. 12 Change
Apr $126.550 +  $0.500
Jun $121.450 +  $1.100
Aug $118.200 +  $0.825
Oct $119.025 +  $0.900
Dec $122.725 +  $0.900
Feb ’20 $124.600 +  $0.650
Apr $125.575 +  $0.975
Jun $119.150 +  $0.775
Aug $117.950 +  $1.450
Corn futures Apr. 12 Change
May $3.610 –  $0.014
Jul $3.694 –  $0.016
Sep $3.774 –  $0.020
Dec $3.890 –  $0.010
Mar ’20 $4.030 -0-
May $4.106 -0-
Oil CME-WTI Apr. 12 Change
May $63.89 + $0.81
Jun $64.02 + $0.87
Jul $64.10 + $0.92
Aug $64.08 + $0.91
Sep $63.96 + $0.89
Oct $63.76 + $0.88

Equities

Equity Indexes Apr. 12 Change
Dow Industrial Average  26412.30 –   12.69
NASDAQ     7984.16 +   45.47
S&P 500     2907.41 +    14.67
Dollar (DXY)          96.94 –       0.45
Cattle Current Weekly Highlights—Week ending Apr. 12, 2019 2019-04-14T14:57:02-05:00

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