Weekly Market Highlights

Cattle Current Weekly Highlights—Week ending Feb. 21, 2020

Despite plenty of pressure and uncertainty in futures and equity markets, cash calf and feeder cattle prices surged higher last week. In fact, regional feeder steer prices in all regions were higher year-over-year for the first time in a long spell, according to the National Weekly Feeder and Stocker Cattle Summary from AMS.

Nationwide, steers and heifers sold $2-$6/cwt. higher, with some auctions from the Northern Plains to the Southern Plains quoting double digit gains, according to the Agricultural Marketing Service (AMS).

“Newfound optimism and warmer weather brought out buyers ready to take on grazing calves,” AMS analysts explain. “Many auction reports made note of the condition of cattle and alluded that buyers were hoping for compensatory gain as soon as the cattle got off the truck.”

“The hope and expectation that 500-550 lbs. steers could reach as high as $160/cwt. this spring is back in play,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Concern was beginning to creep in as the market struggled through the end of January and the first couple of weeks in February, but optimism is back on the table…the thought is that calf prices will continue to escalate for at least three to five weeks before softening.”

Early-week optimism was tied to the rebound in Cattle futures. By the last two trading sessions, though, Cattle futures moved lower, pressured in part by resurgent fears about the impact of novel coronavirus on the global economy, as well as recognition that positive feeding weather is boosting beef production.

Except for $1.67 higher and 72¢higher in the front two contracts, Feeder Cattle futures closed an average of 69¢lower week to week on Friday.

In the meantime, Griffith points out the cull cow market is gaining some steam.

“Breaker-grade cattle exceeded $62/cwt. on average this week with higher dressing cattle exceeding the $70 price mark,” Griffith explains. “The price of slaughter cows is also expected to continue increasing, but the current market may offer some producers an opportunity to offload animals that are consuming valuable feed resources. Fall calving producers should consider pregnancy evaluation this spring and market open animals on what is likely to result in a strong salvage value.”

Fed Cattle Prices Mostly Steady

Negotiated cash fed cattle trade ended the week steady to $1 higher on a live basis at $120/cwt. in the Southern Plains and $119-$120 in the north. Dressed trade was steady at $190.

Live Cattle futures closed an average of $1.49 lower through the front four contracts week to week on Friday. They were an average of 63¢lower across the rest of the board.

Near term, increased slaughter numbers and heavier carcass weights year over year, magnified by the mostly open winter so far are keeping a firmer seasonal lid on wholesale beef prices.

Choice boxed beef cutout value was $3.00 lower week to week on Friday at $205.09/cwt. Select was $4.01 lower at $201.70.

The average steer dressed weight in January was 904 lbs., according to USDA’s monthly Livestock Slaughter report. That was 18 lbs. more than the same month a year earlier. The average dressed heifer weight of 833 lbs. was 9 lbs. more than a year earlier.

Commercial beef production in January was 2.39 billion lbs., which was 78.7 million lbs. more (+3.41%) than the same time a year earlier. Total commercial red meat production for the month was 257.7 million lbs. more (+5.48%) at 4.96 billion lbs.

“There is no doubt that beef demand has been strong since the drought in 2012 and 2013. However, many cattle producers are probably asking why they are not benefiting more from strong demand in the form of higher cattle prices,” Griffith says. “The answer to that lies on the supply side of the equation. Producers responded to high cattle prices by increasing beef supply. Beef production in 2019 was nearly 3.5 billion pounds greater (+14.6%) than in 2015 when the demand index hit 112. Thus, cattle prices are lower.”

Fewer Feedlot Placements than Expected

Feedlots placed fewer cattle in January year over year, according to the monthly USDA Cattle on Feed report released Friday. The report is for feedlots with 1,000 head or more capacity.

Cattle feeders placed 1.96 million head in January, which was 0.61% less (-12,000 head) than the previous year. Ahead of the report, estimates were for placements to be up about 2%.

Marketings in January of 1.93 million head were 1.10% more (+21,000 head) than a year earlier.

Cattle on feed Feb. 1 of 11.93 million head were 2.16% (+252,000 head) more than a year earlier.

Both marketings and the on-feed inventory were close to pre-report estimates.

 

Friday to Friday Change

Weekly Auction Receipts

 

Feb. 21 Auction Direct

Video/net

Total
 

240,100

(+48,300)

36,100

(+6,100)

38,900

(+33,900)

315,100

(+88,300)

 

CME Feeder Index

CME Feeder Index* Feb. 20 Change
  $142.08 +  $1.48

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Feb. 21 Change
600-700 lbs. $161.67 + $3.52
700-800 lbs. $149.33 + $5.11
800-900 lbs. $139.29 + $2.74

 

South Central

Steers-Cash Feb. 21 Change
500-600 lbs. $173.14 + $5.62
600-700 lbs. $154.06 + $3.71
700-800 lbs. $141.42 + $1.49

 

Southeast

Steers-Cash Feb. 21 Change
400-500 lbs. $166.56 + $5.82
500-600 lbs. $152.89 + $5.20
600-700 lbs. $139.59 + $4.44

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Feb. 21 ($/cwt) Change
Choice $205.09 –  $3.00
Select $201.70 –  $4.01
Ch-Se Spread $3.39 + $1.01

 

Futures

Feeder Cattle  Feb. 21 Change
Mar $140.200 + $1.675
Apr $142.100 + $0.725
May $142.850 –  $0.350
Aug $149.675 –  $0.525
Sep $151.000 –  $0.500
Oct $151.800 –  $0.550
Nov $151.800 –  $0.750
Jan ’21 $147.850 –  $1.475

 

Live Cattle   Feb. 21 Change
Feb ’20 $119.725 –  $1.100
Apr $118.250 –  $2.075
Jun $110.275 –  $1.725
Aug $109.400 –  $1.075
Oct $113.275 –  $0.375
Dec $117.525 –  $0.575
Feb ’21 $120.000 –  $0.750
Apr $121.275 –  $0.900
Jun $114.500 –  $0.550

 

Corn  Feb. 21 Change
Mar ’20 $3.770 –  $0.006
May $3.806 –  $0.014
Jul $3.834 –  $0.020
Sep $3.820 –  $0.022
Dec $3.860 –  $0.026
Mar ’21 $3.952 –  $0.028

 

Oil CME-WTI Feb. 21 Change
Apr $53.38 + $1.06
May $53.50 + $0.90
Jun $53.54 + $0.75
Jly $53.50 + $0.63
Aug $53.37 + $0.52
Sep $53.20 + $0.43

 

Equities

Equity Indexes Feb. 21 Change
Dow Industrial Average  28992.41 –   405.67
NASDAQ    9576.59 –   154.59
S&P 500   3337.75 –     42.41
Dollar (DXY)        99.34 +      0.18
Cattle Current Weekly Highlights—Week ending Feb. 21, 2020 2020-02-22T17:15:22-06:00

Cattle Current Weekly Highlights—Week ending Feb. 14, 2020

Despite continued futures price pressure for most of the week, and lower negotiated cash fed cattle prices, calves and feeders mostly found increased support.

Steers and heifers sold from $1/cwt. lower to $3 higher, according to the Agricultural Marketing Service (AMS). Those analysts note demand was strongest for lightweight calves suited for summer grazing.

Weather lightened auction receipts again with an arctic blast and heavy rains limiting movement from southern Oklahoma through the Southeast.

“The mud has made it impossible to get trucks and trailers in and out of fields, not to mention that it has resulted in poorer cattle performance the past couple of months,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “On top of tough weather conditions, feeder Cattle futures have been languishing for three weeks towards the bottom of the trading range.”

Futures optimism increased toward the end of the week, though, as oversold conditions helped set the stage for stronger prices.

Week to week on Friday, Feeder Cattle futures closed an average of $2.61 higher (1.70 to $3.87 higher).

Looking further ahead, USDA’s Agricultural Projections to 2029 suggest calf prices this year will be slightly higher than last year and the lowest for the next decade. This year’s projected farm calf price of $160/cwt. is the lowest of the projection period, which ranges from $165.17 (2028) to $180.88 (2023).

Fed Cattle Prices Sag

Negotiated cash fed cattle trade ended the week $2-$3 lower at $119/cwt. on a live basis and $3 lower in the beef at $190.

“Most of the cattle coming off feed today are profitable, and with the dip in feeder cattle prices the past few weeks, current placements have a good chance of being profitable,” Griffith says.

Except for 50¢lower in spot Feb, Live Cattle futures closed an average of 63¢higher week to week on Friday.

The latest World Agricultural Supply and Demand Estimates (WASDE) increased projected beef production for this year 40 million lbs. more than the January estimate at 27.48 billion lb.

“The beef production forecast is raised from the previous month on higher cattle slaughter and heavier cattle weights in the first half of the year. However, the forecasts for second-half beef production is reduced on lower anticipated steer and heifer slaughter in the second half of the year,” explain USDA analysts. “This reflects a smaller number of cattle outside feedlots implied by the Jan. 1 Cattle report which results in lower placements during 2020.”

Total red meat and poultry production was projected 634 million lbs. more at 108.79 billion lbs.

The annual fed steer price (five-area direct) was projected at $117/cwt.: $123 for the first quarter; $118 for the second; $112 for the third; $114 for the fourth quarter.

In the meantime, Choice boxed beef cutout value was $2.03 lower week to week on Friday at $208.09/cwt. Select was $1.82 higher at $205.71.

“Despite the struggle of cutout prices during a time when beef demand is slack, retail prices started off the year extremely strong,” Griffith explains. “The retail price of Choice beef for January was nearly $6.06/lb., which was 20¢/lb.higher than it was in January of 2019. The all fresh retail beef price for January was nearly $5.94/lb., which was 24¢ higher.”

 

Friday to Friday Change

Weekly Auction Receipts

 

Feb. 14 Auction Direct

Video/net

Total
 

191,800

(+5,200)

30,000

(+22,100)

5,000

(-19,900)

226,800

(+7,400)

 

CME Feeder Index

CME Feeder Index* Feb. 13 Change
  $140.60 –   $0.03

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Feb. 14 Change
600-700 lbs. $158.15 –  $0.35
700-800 lbs. $144.22 –  $2.47
800-900 lbs. $136.55 –  $1.44

 

South Central

Steers-Cash Feb. 14 Change
500-600 lbs. $167.52 + $4.31
600-700 lbs. $150.35 + $0.65
700-800 lbs. $139.93 + $0.42

 

Southeast

Steers-Cash Feb. 14 Change
400-500 lbs. $160.74 + $4.16
500-600 lbs. $147.69 + $1.26
600-700 lbs. $135.15 + $0.31

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Feb. 14 ($/cwt) Change
Choice $208.09 –  $2.03
Select $205.71 + $1.82
Ch-Se Spread $2.38 –  $3.85

 

Futures

Feeder Cattle  Feb. 14 Change
Mar $138.525 + $3.325
Apr $141.375 + $3.875
May $143.200 + $3.625
Aug $150.200 + $2.325
Sep $151.500 + $2.025
Oct $152.350 + $2.000
Nov $152.550 + $1.700
Jan ’21 $149.325 + $2.025

 

Live Cattle   Feb. 14 Change
Feb ’20 $120.825 –  $0.500
Apr $120.325 + $0.525
Jun $112.000 + $0.725
Aug $110.475 + $0.600
Oct $113.650 + $0.550
Dec $118.100 + $0.500
Feb ’21 $120.750 + $0.525
Apr $122.175 + $0.825
Jun $115.050 + $0.800

 

Corn  Feb. 14 Change
Mar ’20 $3.776 –  $0.058
May $3.820 –  $0.064
Jul $3.854 –  $0.068
Sep $3.842 –  $0.052
Dec $3.886 –  $0.054
Mar ’21 $3.980 –  $0.046

 

Oil CME-WTI Feb. 14 Change
Mar $52.05 + $1.73
Apr $52.32 + $1.77
May $52.60 + $1.78
Jun $52.79 + $1.75
Jly $52.87 + $1.65
Aug $52.85 + $1.54

 

Equities

Equity Indexes Feb. 14 Change
Dow Industrial Average  29398.08 + 295.57
NASDAQ   9731.18 +  210.67
S&P 500   3380.16 +    52.45
Dollar (DXY)        99.16 +     0.44
Cattle Current Weekly Highlights—Week ending Feb. 14, 2020 2020-02-16T17:45:01-06:00

Cattle Current Weekly Highlights—Week ending Feb. 7, 2020

Despite volatile outside markets and what appeared to be overall softer cash fed cattle prices, calves and feeders sold for mostly higher money last week.

Steers and heifers traded mainly steady to $3/cwt. higher, according to the Agricultural Marketing Service (AMS). The exception was $1-$3 lower in the Southeast.

“Demand was evident this week in the Dakotas on lighter-weight calves suitable for summer grazing (under 600 lbs.),” according to AMS analysts. “Heavier-weight cattle that will go directly to the feedyard are still in demand, just not at the handsome prices seen at the beginning of January.”

AMS analysts note that winter weather continues to impact the market with dicey travel conditions and impacts on feedlot performance. 

The AMS reporter on hand for Thursday’s Superior Livestock video auction pointed out feedyards remain relatively full, while winter weather and muddy pen conditions are depressing gains.

“Cost of gains are increasing as the winter has taken its toll on pen conditions in several areas this winter,” say AMS analysts. “The extra mud takes energy away from weight gain; steer carcass weights declined to 901 lbs. for week ending Jan. 25, which was 6 lbs. lower than the previous week and 13 lbs. heavier than a year ago.” 

Throw in volatile outside markets, tied to fears over how novel coronavirus could slow global economic growth and Cattle futures took a rollercoaster ride.

Week to week on Friday, Feeder Cattle futures closed from an average of 51¢lower to an average of 87¢higher.

AMS analysts note Feb-May Feeder Cattle contracts declined $11.63 to $12.55 since Jan. 13. 

With all of that said, it appears the lowest prices of the cattle cycle are in the rearview mirror (see below).

Fed Cattle Prices Soften

Negotiated cash fed cattle trade was yet to fully develop through Friday afternoon but was shaping up lower. Live prices in the Southern Plains were $1 lower than the previous week at $121/cwt. Although too few to trend, early live sales in Nebraska were also $1 lower at $121, while early dressed sales were $1-$2 lower at $193-$195.

Except for 5¢to 30¢lower toward the front of the board, Live Cattle futures closed an average of 48¢higher week to week on Friday.

Since January 13, the front five Live Cattle contracts declined $6.10 to $8.50, according to AMS analysts.

“Despite a softer Live Cattle futures market than just a few weeks ago, the expectation remains for finished cattle to reach as high as $130 in the spring months,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “There is no good reason for the market to be experiencing weakness from a fundamental standpoint. There have not been any real surprises in market information as it relates to cattle supply and expected beef production, nor has there been any negative information on the demand side.”

Wholesale beef values declined with seasonal pressure and wonderments about global economic growth.

Choice boxed beef cutout value was $2.88 lower week to week on Friday at $212.12/cwt. Select was $6.77 lower at $203.89.

U.S. Beef Exports Should Regain Momentum

U.S. beef exports last year totaled 1.32 million metric tons (mt), 2.5% below the previous year’s record volume, according to data released by USDA and compiled by the U.S. Meat Export Federation (USMEF). Beef export value was 3% less at  $8.1 billion. Beef export value per head of fed slaughter last year was $309.75, down 4%.

USMEF attributes part of the decline to decreased exports to Japan, borne by the tariff disadvantage of the U.S., compared to its competitors. U.S. beef exports to Japan were 6% less in both volume (311,146 mt) and value ($1.95 billion). Recent ratification of a new trade agreement by the Japanese Parliament should offer some relief. As of Jan. 1, the tariff rate declined from 38.5% to 26.6%, the same as other major competitors, according to USMEF. There will be another rate cut April 1.

At the same time, U.S. pork exports posted new volume and value records in 2019, 10% more than the previous year in volume (2.67 million mt) and 9% higher in value ($6.95 billion).

Cattle Prices Set to Strengthen

At the 2020 Industry Outlook in San Antonio last week, CattleFax analysts explained beef demand is strong and with U.S. cattle numbers plateauing, prices are likely to be stronger in the year ahead as consumers at home and abroad support industry profitability.

CattleFax forecasts steer calf prices (550 lbs.) this year $6 higher than last year at an average of $170/cwt., across a range of $155-$180.

CattleFax also projects feeder steer prices (750 lbs.), $6 higher, at an average of $150/cwt., across a range of $140-$160.

Kevin Good, CattleFax Vice President of Industry Relations and Analysis explained, “With strong demand for U.S. beef at home and rising demand overseas, the modest increases in supply will be more than offset by a growing consumer appetite for our product.”

CattleFax projects fed steer prices to average $120/cwt. during 2020, which would $3 more than last year. He notes there is downside risk at $108 and resistance at $130.

“There is strong demand for our product, but that’s the result of the fact that our business has paid attention to market signals and we’ve been producing a consistent, quality product that has gained a greater piece of that retail dollar. We need to protect that,” says Randy Blach, CattleFax CEO.

Friday to Friday Change

Weekly Auction Receipts

 

Feb. 7 Auction Direct

Video/net

Total
 

186,600

(-66,500)

7,900

(-6,400)

24,900

(+22,400)

219,400

(-50,500)

 

CME Feeder Index

CME Feeder Index* Feb. 6 Change
  $140.63 –   $1.75

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Feb. 7 Change
600-700 lbs. $158.50 + $0.85
700-800 lbs. $146.69 + $0.35
800-900 lbs. $137.99 –  $1.94

 

South Central

Steers-Cash Feb. 7 Change
500-600 lbs. $163.21 + $2.40
600-700 lbs. $149.70 + $4.27
700-800 lbs. $139.51 –  $0.02

 

Southeast

Steers-Cash Feb. 7 Change
400-500 lbs. $156.58 –  $3.27
500-600 lbs. $146.43 –  $1.80
600-700 lbs. $134.84 –  $1.64

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Feb. 7 ($/cwt) Change
Choice $210.12 –  $2.88
Select $203.89 –  $6.77
Ch-Se Spread $6.23 + $3.89

 

Futures

Feeder Cattle  Feb. 7 Change
Mar $135.200 –  $0.875
Apr $137.500 –  $0.025
May $139.575 –  $0.125
Aug $147.875 + $1.000
Sep $149.475 + $0.875
Oct $150.350 + $0.750
Nov $150.850 + $0.875
Jan ’21 $147.300 –  $1.025

 

Live Cattle   Feb. 7 Change
Feb ’20 $121.325 –  $0.050
Apr $119.800 + $0.125
Jun $111.275 –  $0.300
Aug $109.875 –  $0.100
Oct $113.100 + $0.275
Dec $117.600 + $0.575
Feb ’21 $120.225 + $0.675
Apr $121.350 + $0.650
Jun $114.250 + $0.600

 

Corn  Feb. 7 Change
Mar ’20 $3.834 + $0.022
May $3.884 + $0.020
Jul $3.922 + $0.012
Sep $3.894 + $0.018
Dec $3.940 + $0.034
Mar ’21 $4.026 + $0.022

 

Oil CME-WTI Feb. 7 Change
Mar $50.32 –  $1.24
Apr $50.55 –  $1.13
May $50.82 –  $0.95
Jun $51.04 –  $0.76
Jly $51.22 –  $0.52
Aug $51.31 –  $0.28

 

Equities

Equity Indexes Feb. 7 Change
Dow Industrial Average  29102.51 + 576.48
NASDAQ   9250.51 +    99.57
S&P 500   3327.71 + 102.19
Dollar (DXY)        98.72 +     0.36
Cattle Current Weekly Highlights—Week ending Feb. 7, 2020 2020-02-09T17:31:33-06:00

Cattle Current Weekly Highlights—Week ending Jan. 31, 2020

Fears about the potential global economic impact of novel coronavirus continued to hammer equity and futures markets. Although Cattle futures firmed at the end of the week, steep losses early on helped pressure cash markets.

Nationwide, steers and heifers sold mostly $2-$5/cwt. lower, according to the Agricultural Marketing Service (AMS). There were instances of as much as $10 lower. The exception was portions of the Southeast.

Feeder Cattle futures closed an average of $3.89 lower week to week on Friday ($2.62 to $4.97 lower). That’s an average of $8.07 lower in the last two weeks.

Fed Cattle Trade Lower

Negotiated cash fed cattle trade ended the week generally $2-$3 lower on a live basis at $122/cwt. in the Southern Plains and Nebraska; $122-$123 in the western Corn Belt. Dressed sales were $3-$4 lower at $195.

“It should not be surprising for finished cattle prices to soften during January and February when beef supplies are plentiful and when beef demand is seasonally soft,” explains Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “However, the April Live Cattle contract is offering very little hope of a price resurgence heading into the summer grilling season. Thus, despite strong margins at the feedlot right now, many cattle feeders are already focused on the spring and summer marketing time frame. Many will have taken advantage of the previously strong futures contract price and hedged cattle, but those who did not will be looking to improve their situation.”

Live Cattle futures closed an average of $3.01 lower week to week on Friday ($1.30 to $4.62 lower). That’s an average of $5.40 lower over the last two weeks.

From Jan. 24 through Jan. 30, open interest declined by 34,260 contracts (-8.7%).

“Cattle slaughter is expected to decrease in 2020, including a slight year-over-year decline in steer and heifer slaughter and lower cow slaughter,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “However, large current feedlot inventories confirm that slaughter will be higher early in the year before decreasing in the second half of 2020. Total annual beef production is expected to be slightly higher year over year as heavier carcass weights offset lower slaughter. Beef production in the first half of the year will be higher on increased slaughter and larger carcass weights before lower slaughter pulls beef production down late in the year.”

Choice boxed beef cutout value was $1.49 lower week to week on Friday at $213.00/cwt. Select was 4¢ lower at $210.66.

“Given that red meat production is expected to remain elevated in 2020, it points to the importance of being able to export pork and beef,” Griffith says. “The relaxation of Chinese restrictions on U.S. beef and pork should improve the flow of meat to China, while the tremendous reduction in cattle numbers in Australia should also benefit U.S. beef exports. The market is not expected to move quickly, but this should support prices despite strong beef and pork production in 2020.”

President Trump also signed the U.S.-Mexico-Canada Agreement last week, which should remove some uncertainty from North American trade.

Herd Expansion Ends

Based on USDA’s Cattle report released Friday, as widely expected, national herd expansion is over.

USDA pegs the Jan. 1 inventory of all cattle and calves at 94.41 million head, which is 0.41% less (-391,400 head) than a year earlier.

Beef cows Jan. 1 were 31.31 million head, which was 1.18% less (-374,000 head) than the previous year.

Beef replacement heifers Jan 1 of 5.77 million head were 1.92% fewer (-113,000 head) than the previous year.

Milk cows Jan. 1 of 9.33 million head were 2.10% less (-113,000 head) than the same time a year earlier.

The 2019 calf crop was estimated at 36.06 million head, which was 0.70% less (-253,100 head) than in 2018

Cattle on feed Jan. 1—for all feedlots—of 14.68 million head was 2.16% more (309,800 head) than the previous year.

The estimated feeder cattle supply outside feedlots Jan. 1 of 26.45 million head is 0.40% less (-105,300 head) than a year earlier.

There were 1.61 million head grazing small grain pastures in Kansas, Oklahoma and Texas on Jan. 1. That was 15.26% less (-290,000 head) than a year earlier.

“With total cattle inventories at or just past a cyclical peak, feedlot inventories will likely peak in the next few months,” Peel says. “However, average feedlot inventories are currently record large. After peaking last August then declining for two months, the 12-month moving average of feedlot inventories moved higher the last three months and is currently at 11.639 million head, record large for the current data series back to 1996.”

Friday to Friday Change

Weekly Auction Receipts

 

Jan. 31 Auction Direct

Video/net

Total
 

253,100

(+32,500)

14,300

(-25,300)

2,500

(-34,300)

269,900

(-27,100)

 

CME Feeder Index

CME Feeder Index* Jan. 30 Change
  $142.38 –   $2.37

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Jan. 31 Change
600-700 lbs. $157.55 –  $2.59
700-800 lbs. $146.34 –  $3.08
800-900 lbs. $139.93 –  $3.66

 

South Central

Steers-Cash Jan. 31 Change
500-600 lbs. $160.81 –  $3.58
600-700 lbs. $145.43 –  $3.18
700-800 lbs. $139.53 –  $3.06

 

Southeast

Steers-Cash Jan. 31 Change
400-500 lbs. $159.85 –  $1.64
500-600 lbs. $148.23 –  $0.91
600-700 lbs. $136.48 –  $0.80

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Jan. 31 ($/cwt) Change
Choice $213.00 –  $1.49
Select $210.66 –  $0.04
Ch-Se Spread $2.34 –  $1.45

 

Futures

Feeder Cattle  Jan. 31 Change
Mar $136.075 –  $3.600
Apr $137.525 –  $4.975
May $139.700 –  $4.775
Aug $146.875 –  $4.425
Sep $148.600 –  $3.775
Oct $149.600 –  $3.075
Nov $149.975 –  $2.625
Jan ’21 $148.325 n/a

 

 

Live Cattle   Jan. 31 Change
Feb ’20 $121.375 –  $3.475
Apr $119.675 –  $4.625
Jun $111.575 –  $4.450
Aug $109.775 –  $3.850
Oct $112.825 –  $3.325
Dec $117.025 –  $2.425
Feb ’21 $119.550 –  $1.925
Apr $120.700 –  $1.750
Jun $113.650 –  $1.300

 

Corn  Jan. 31 Change
Mar ’20 $3.812 –  $0.060
May $3.864 –  $0.062
Jul $3.910 –  $0.066
Sep $3.876 –  $0.080
Dec $3.906 –  $0.076
Mar ’21 $4.004 –  $0.072

 

Oil CME-WTI Jan. 31 Change
Mar $51.56 –  $2.63
Apr $51.68 –  $2.52
May $51.77 –  $2.35
Jun $51.80 –  $2.11
Jly $51.74 –  $1.87
Aug $51.59 –  $1.65

 

Equities

Equity Indexes Jan. 31 Change
Dow Industrial Average  28256.03 –  733.70
NASDAQ   9150.94 –  163.97
S&P 500   3225.52 –    69.95
Dollar (DXY)        97.36 –      0.52
Cattle Current Weekly Highlights—Week ending Jan. 31, 2020 2020-02-01T15:22:53-06:00

Cattle Current Weekly Highlights—Week ending Jan. 17, 2020

Although overall market optimism continued last week, weather and market volatility surrounding trade issues created some price pressure for feeder cattle and calves. Nationwide, steers and heifers sold from $1/cwt. lower to $2 higher, according to the Agricultural Marketing Service (AMS).

“Colder weather conditions combined with moisture systems affected many areas of the country, constraining receipts in some areas as producers elected to wait for better conditions before bringing cattle to town,” say AMS analysts. “Feedlots in all regions remain at or near full capacity. Grazing wheat in areas of the Southern Plains remains challenging with the current conditions, which has caused many cattle to be placed in grow yard or feedlots earlier than planned.”

Feeder Cattle futures closed an average of $1.53 lower week to week on Friday, from 45¢ lower at the back to $2.45 lower toward the front.

Regionally speaking, Andrew P. Griffith, agricultural economist at the University of Tennessee says, “The mild temperatures that have been experienced in the Southeast United States may have calf prices escalating more quickly than is typical because some stocker operations may have more grass available this time of year than they normally would. The warmer than average temperatures and adequate moisture has definitely supported winter annual forage production, and producers who graze these species are definitely looking for animals to graze and manage the growth.”

In his weekly market comments, Griffith also notes increasingly strong demand for calves with less health risk.

“Based on weekly auction market price averages, 525-pound value-added steers brought $12/cwt. more than non-value-added steers,” Griffith says. “This equates to the value-added steers bringing about $60 more per head, which more than pays for the vaccines and extra labor. This does not include the additional weight a producer may have achieved from a preconditioning program.”

Fed Cattle Prices Wobble

Negotiated cash fed cattle trade through Friday afternoon was steady on a live basis in the Southern Plains and Nebraska at $124/cwt., but $1 lower in the western Corn Belt at $123-$125. Dressed sales were steady to $2 lower at $198-$200.

“Following the strong run in finished cattle prices in December and a strong start to January, fed cattle prices have stagnated the past couple of weeks,” Griffith says. “Despite the appearance that prices stalled, this should still be considered positive for cattle feeders. January and February are not known as strong beef demand months, nor are they known for having the best finished cattle prices. The upside to current prices is that beef and cattle demand are strong in the spring, which should bode well for the price of finished cattle. There remains potential for the cash market to trade over $130 at some point, but cattle feeders are more concerned with maintaining strong prices over a longer period.”

Live Cattle futures closed an average of 57¢ lower, from 25¢ lower to $1.07 lower in spot Feb.

Wholesale beef values continued to crawl up from the seasonal ebb. Choice boxed beef cutout value was $4.13 higher week to week on Friday at $214.17/cwt. Select was $6.20 higher at $212.75.

Positive Trade Deals and Lots of Questions

U.S. agriculture, including cattle and beef, scored long-sought trade victories last week with the signing of the phase-one trade deal between the U.S. and China, as well as Senate approval of the U.S.-Mexico-Canada Agreement (USMCA). Market reaction was muted to negative, though, given the lack of clarity regarding timing and potential purchase volume.

China agreed to purchase and import, on average, at least $40 billion of U.S. food, agricultural, and seafood products annually for a total of at least $80 billion over the next two years, according to a factsheet from the U.S. Trade Representative.

“It is not likely that beef will be the big winner in the trade agreement with China as it relates to direct shipments of beef to China,” Griffith explains. “The United States ships very little beef to mainland China, and it is unlikely this agreement will change that. It is most likely that pork will witness the largest increase in purchases from China, given their depleted pork supplies from African Swine Fever, while the purchase of soybeans will also be on the top of the list. Despite the expectation that direct beef trade will not escalate quickly, moving more pork should support domestic meat protein prices and thus beef prices.”

Part of the phase-one trade deal does remove key Chinese non-tariff trade barriers to U.S. beef, which could prove to be the major win. The deal eliminates the 30-month age restriction, provides acceptance of current U.S. traceability and removes the ban on U.S. beef from cattle grown with commonly used and safe-proven growth hormones.

As for the USMCA, Canada and Mexico are the first and second largest export markets for U.S. food and agricultural products, totaling more than $39.7 billion food and agricultural exports in 2018, according to USDA. Mexico and Canada account for about one-third of all U.S. red meat exports, according to the U.S. Meat Export Federation. Shipments to Mexico and Canada in 2019 totaled about 1.25 million metric tons valued at $3.8 billion.

Before ratification and signing of the latter two agreements, ERS forecast total U.S. beef exports in 2020 to increase about 6% year over year to a record 3.3 billion lbs.

Friday to Friday Change

Weekly Auction Receipts

 

Jan. 17 Auction Direct

Video/net

Total
 

281,400

(-96,100)

49,300

(-10,600)

61,700

(-32,600)

392,400

(-139,300)

 

CME Feeder Index

CME Feeder Index* Jan. 16 Change
  $145.67 –   $1.16

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Jan. 17 Change
600-700 lbs. $160.77 + $2.03
700-800 lbs. $149.77 –  $1.09
800-900 lbs. $145.81 + $1.21

 

South Central

Steers-Cash Jan. 17 Change
500-600 lbs. $164.28 + $1.36
600-700 lbs. $150.06 + $0.01
700-800 lbs. $143.76 –  $1.93

 

Southeast

Steers-Cash Jan. 17 Change
400-500 lbs. $159.36 + $2.10
500-600 lbs. $147.91 + $2.45
600-700 lbs. $137.06 + $0.82

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Jan. 17 ($/cwt) Change
Choice $214.17 + $4.13
Select $212.75 + $6.20
Ch-Se Spread $1.42 –  $2.07

 

Futures

Feeder Cattle  Jan. 17 Change
Jan ’20 $145.350 –  $2.250
Mar $145.000 –  $2.450
Apr $147.875 –  $2.175
May $149.450 –  $1.750
Aug $154.875 –  $1.425
Sep $155.950 –  $1.025
Oct $156.200 –  $0.700
Nov $156.225 –  $0.450

 

Live Cattle   Jan. 17 Change
Feb ’20 $126.350 –  $1.075
Apr $127.250 –  $0.700
Jun $119.200 –  $0.575
Aug $116.775 –  $0.500
Oct $118.900 –  $0.500
Dec $121.750 –  $0.250
Feb ’21 $123.450 –  $0.375
Apr $124.000 –  $0.450
Jun $117.125 –  $0.725

 

Corn  Jan. 17 Change
Mar ’20 $3.892 + $0.036
May $3.952 + $0.026
Jul $4.010 + $0.016
Sep $4.002 –  $0.002
Dec $4.026 -0-
Mar ’21 $4.124 -0-

 

Oil CME-WTI Jan. 17 Change
Feb $58.54 –  $0.50
Mar $58.58 –  $0.41
Apr $58.51 –  $0.34
May $58.30 –  $0.33
Jun $57.96 –  $0.36
Jly $57.54 –  $0.38

 

Equities

Equity Indexes Jan. 17 Change
Dow Industrial Average  29348.10 +  524.23
NASDAQ   9388.94 +  210.08
S&P 500   3329.62 +    64.27
Dollar (DXY)        97.64 +      0.29
Cattle Current Weekly Highlights—Week ending Jan. 17, 2020 2020-01-18T17:21:29-06:00

Cattle Current Weekly Highlights—Week ending Jan. 10, 2020

Cattle markets gained ground last week, amid the first week of full trade since the holidays, helped along by stronger Cattle futures, supported by expected seasonally snugger harvest-ready cattle supplies.

“Grazing steers and heifers sold sharply higher than the previous week’s light receipts, while feeder steers and heifers sold $1/cwt. lower to $3 higher,” according to the Agricultural Marketing Service (AMS). “Load lots of long-time weaned calves were in the offering as producers were ready to get their calves marketed. Several loads of lightweight calves could be procured, from the Southern Plains to the Northern Plains.”

Feeder Cattle futures closed an average of $3.95 higher week to week on Friday.

“Calf and feeder cattle markets responded as expected with strong gains to start the year and the trend should continue moving through the next few months,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “…The greater optimism is the expectation that the summer and all months of 2020 should be stronger than those of 2019.”

Cash Fed Cattle Prices Likely Steady to Higher

Through Friday afternoon, based on USDA reports, cash fed cattle trade was yet to be fully established, but early indications were for another week of steady to higher prices.

For instance, although too few to trend, early dressed sales in Nebraska and the western Corn Belt were at $200/cwt., which was mainly steady to $2 higher than the previous week.

“Packers have watched their margins tighten the past few weeks as boxed beef prices declined and finished cattle prices escalated,” Griffith explains. “…Everyone prefers more to less when it comes to margins and packers are attempting to draw cattle prices lower to support their margins. They may have a little success in the short-run but time is not on their side, as grilling season will fast approach.”

Except for $1.65 lower in the back contact, Live Cattle futures closed an average of $1.89 higher.

Wholesale beef values finally began to turn slowly away from an apparent seasonal ebb. Choice boxed beef cutout value was $1.55 higher week to week on Friday at $210.04/cwt. Select was $1.16 higher at $206.55.

“The beef supply situation is expected to be more supportive this year, with cyclical herd expansion over and beef production peaking,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “The current status of the cattle cycle will be confirmed in the Cattle inventory report to be released at the end of January. In general, cattle numbers are expected to be down slightly year over year. Beef production is expected to peak fractionally higher in 2020, with heavier carcass weights offsetting a slight decline in cattle slaughter. Carcass weights finished 2019 above year-earlier levels and will bear watching in the coming year.”

The latest monthly World Agricultural Supply and Demand Estimates (WASDE forecast 2020 beef production at 27.44 billion lbs., which would be 289 million lbs. more (+1.06%) than in 2019.

WASDE anticipates average cash fed steer prices (five-area direct) for 2020 to be $125/cwt. in the first quarter, $118 in the second, $112 in the third and $114 in the fourth. The annual average price for 2020 is projected at $117.50, which is 50¢ more than the previous month’s estimate and 72¢ more than the estimated average in 2019.

Friday to Friday Change

Weekly Auction Receipts

 

Jan. 10 Auction Direct

Video/net

Total
 

377,500

(+339,600)

59,900

(+44,500)

94,300

(+94,300)

531,700

(+478,400)

 

CME Feeder Index

CME Feeder Index* Jan. 9 Change
  $146.83 +  $1.96

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Jan. 10 Change
600-700 lbs. $158.74 + $4.08
700-800 lbs. $150.86 + $3.12
800-900 lbs. $144.60 –  $0.14

 

South Central

Steers-Cash Jan. 10 Change
500-600 lbs. $162.92 + $1.51
600-700 lbs. $150.05 –  $1.92
700-800 lbs. $145.69 –  $3.99

 

Southeast

Steers-Cash Jan. 10 Change
400-500 lbs. $157.26  n/a
500-600 lbs. $145.46  n/a
600-700 lbs. $136.24  n/a

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Jan. 10 ($/cwt) Change
Choice $210.04 + $1.55
Select $206.55 + $1.16
Ch-Se Spread $3.49 + $0.39

 

Futures

Feeder Cattle  Jan. 10 Change
Jan ’20 $147.600 + $4.250
Mar $147.450 + $4.775
Apr $150.050 + $4.525
May $151.200 + $4.175
Aug $156.300 + $3.850
Sep $156.975 + $3.525
Oct $156.900 + $3.175
Nov $156.675 + $3.300

 

Live Cattle   Jan. 10 Change
Feb ’20 $127.425 + $2.700
Apr $127.950 + $2.275
Jun $119.775 + $2.100
Aug $117.275 + $1.725
Oct $119.400 + $1.650
Dec $122.000 + $1.550
Feb ’21 $123.825 + $1.700
Apr $124.450 + $1.450
Jun $117.850 –  $1.650

 

Corn  Jan. 10 Change
Mar ’20 $3.856 –  $0.008
May $3.926 –  $0.004
Jul $3.994 + $0.002
Sep $4.004 + $0.022
Dec $4.026 + $0.020
Mar ’21 $4.124 + $0.014

 

Oil CME-WTI Jan. 10 Change
Feb $59.04 –  $4.01
Mar $58.99 –  $3.33
Apr $58.85 –  $3.63
May $58.63 –  $3.39
Jun $58.32 –  $3.14
Jly $57.92 –  $2.91

 

Equities

Equity Indexes Jan. 10 Change
Dow Industrial Average  28823.87 +  188.99
NASDAQ   9178.86 +  158.09
S&P 500   3265.35 +    30.50
Dollar (DXY)        97.35 +      0.45
Cattle Current Weekly Highlights—Week ending Jan. 10, 2020 2020-01-12T16:26:07-06:00

Cattle Current Weekly Highlights—Week ending Jan. 3, 2020

Calves and feeder cattle remained lightly tested during another holiday-shortened week.

“Those that did have sales were quoting much stronger prices as order buyers and farmer feeders alike were back in the seats ready to fill orders,” said analysts with the Agricultural Marketing Service (AMS).  “Most observers described buyers’ moods as being hungry and ready to procure cattle as the holidays seemed to drag out this year.”

Except for 37¢ higher in the back contract, Feeder Cattle futures closed an average of $1.29 lower week to week on Friday (7¢ lower toward the back to $2.20 lower in spot Jan).

“Calf prices do tend to start strengthening in January, but it generally takes a couple of weeks for prices to start their strong spring ascension,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments.“Typically, the price for lightweight cattle continues to increase in February and March, but this is not a recommendation to hold calves until March. This is a recommendation to hold onto the reins a little longer to see if the market is going to move in the favor of those looking to market calves in the near term.”

Fed Cattle Prices Continue Higher

Negotiated cash fed cattle trade developed fully on Friday with live sales $2 higher at $124/cwt. in the Southern Plains and Nebraska; $2-$4 higher in the western Corn Belt at $125. Dressed sales were mostly $4 higher in Nebraska at mainly $199 and $3-$4 higher in the western Corn Belt at $198-$199.

Except for 10¢ lower toward the back, Live Cattle futures closed an average of $1.09 lower (12¢ lower toward the back to $2.10 lower toward the front). 

“The market and feeding conditions are both far better than where they were a year ago. Market prices today are only a couple of dollars higher than the same week last year, but cattle coming off feed right now were purchased much cheaper than the cattle coming off this time last year,” Griffith says. “At the same time, most cattle feeders are not dealing with the same wet and sloppy feeding conditions they had last year which resulted in a higher feed cost and lighter cattle coming off feed.”

The average dressed steer weight for the week ending Dec. 21 was 904 lbs., which was the same as a week earlier but 13 lbs. heavier than the prior year, according to USDA’s latest Actual Slaughter Under Federal Inspection report. The average dressed heifer weight of 834 lbs. was 1 lb. lighter than the previous week but 8 lbs. heavier than the previous year.

Choice boxed beef cutout value was 47¢ lower week to week on Friday at $208.49/cwt. Select was 82¢ higher at $205.39.

“Retailers are beginning to pull on Select grade beef as winter rolls in and as consumers move to consumption of end cuts,” Griffith says. “The change is most evident in the narrowing of the Choice-Select spread, which generally provides an indication of relative quantity supplied and demanded for Choice and Select beef.”

As is typical, the Choice-Select spread will likely continue to narrow through February, but Griffith emphasizes Choice demand remains strong and is expected to remain strong.

Friday to Friday Change

Weekly Auction Receipts

 

Jan. 3 Auction Direct

Video/net

Total
 

37,900

(+32,600)

15,400

(-1,000)

-0-

(-0-)

53,300

(+31,600)

 

CME Feeder Index

CME Feeder Index* Jan. 2 Change
  $144.87 +  $0.26

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Jan. 3 Change
600-700 lbs. $154.66 + $0.12
700-800 lbs. $147.74 –  $1.75
800-900 lbs. $144.74 –  $3.95

 

South Central

Steers-Cash Jan. 3 Change
500-600 lbs. $161.41  n/a
600-700 lbs. $151.97  n/a
700-800 lbs. $149.68  n/a

 

Southeast

Steers-Cash Jan. 3 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.) Jan. 3 ($/cwt) Change
Choice $208.49 –  $0.47
Select $205.39 + $0.82
Ch-Se Spread $3.10 –  $1.29

 

Futures

Feeder Cattle  Jan. 3 Change
Jan ’20 $143.350 –  $2.200
Mar $142.675 –  $2.125
Apr $145.525 –  $1.775
May $147.025 –  $1.475
Aug $152.450 –  $0.875
Sep $153.450 –  $0.500
Oct $153.725 –  $0.075
Nov $153.375 + $0.375

 

Live Cattle   Jan. 3 Change
Feb ’20 $124.725 –  $1.975
Apr $125.675 –  $2.100
Jun $117.675 –  $1.425
Aug $115.500 –  $1.150
Oct $117.750 –  $0.625
Dec $120.450 –  $0.200
Feb ’21 $122.125 –  $0.125
Apr $123.000 + $0.100
Jun $119.500 n/a

 

Corn  Jan. 3 Change
Mar ’20 $3.864 –  $0.036
May $3.930 –  $0.036
Jul $3.992 –  $0.034
Sep $3.982 –  $0.040
Dec $4.006 –  $0.028
Mar ’21 $4.110 –  $0.012

 

Oil CME-WTI Jan. 3 Change
Feb $63.05 + $1.33
Mar $62.82 + $1.29
Apr $62.48 + $1.27
May $62.02 + $1.23
Jun $61.46 + $1.18
Jly $60.83 + $1.13

 

Equities

Equity Indexes Jan. 3 Change
Dow Industrial Average  28634.88 –    10.38
NASDAQ   9020.77 +    14.15
S&P 500   3234.85 –       5.17
Dollar (DXY)        96.90 –       0.11
Cattle Current Weekly Highlights—Week ending Jan. 3, 2020 2020-01-05T15:59:25-06:00

Cattle Current Weekly Highlights—Week ending Dec. 27, 2019

There was no price trend for calves and feeder cattle last week, given the holiday and just 21,700 head trading hands via auction, direct sales and video-Internet, according to the Agricultural Marketing Service (AMS).

Recent optimism remains intact, though, given the way Cattle futures shrugged off the previous week’s Cattle on Feed report.

Feeder Cattle futures closed an average of 85¢ higher week to week on Friday.

Live Cattle futures closed an average of 92¢ higher. 

“Unseasonably warm weather was noted in several areas during the mid-week holiday, however a weekend weather system is forecasted to bring rain to the Southern Plains and large snow accumulations to areas of the Northern Plains,” say AMS analysts. 

Fed Cattle Prices Step Higher

Cattle futures received support from continued firmness in cash fed cattle prices, which gained for another week.

Negotiated cash fed cattle trade was yet to be fully developed through Friday afternoon, but early prices were higher. The Texas Cattle Feeders Association reported its members trading at $122/cwt., which was $2 higher than the previous week. Likewise, AMS reported live sales in Kansas at $122, which was $2 higher than the prior week. In Nebraska, dressed sales were mostly $3 higher at mostly $196. Although too few to trend, early dressed sales in the western Corn Belt were $3-$4 higher at $195-$196.

“Higher placements the last three months have rebuilt feedlot inventories going into 2020,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “Feedlots will be a bit front loaded in the first quarter of the new year and marketings are expected strong against the April Live Cattle futures contract. Of course, weather often impacts cattle performance and the timing of feedlot production this time of year and may affect feedlot marketings through the winter.”

Wholesale beef values continued to trade along the seasonal bottom.

Choice boxed beef cutout value was 74¢ lower week to week on Friday at $208.96/cwt. Select was $3.54 higher at $204.57.

The average dressed steer carcass weight for the week ending Dec. 14 was 904 lbs., according to USDA’s Actual Slaughter Under Federal Inspection report. That was 2 lbs. lighter than the previous week but 12 lbs. heavier than the previous year. The average dressed heifer carcass weight was 835 lbs., which was 5 lbs. lighter than the previous week but 6 lbs. heavier than a year earlier.

Friday to Friday Change*

Weekly Auction Receipts

 

Dec.27 Auction Direct

Video/net

Total
 

5,300

(-217,700)

16,400

(-29,100)

-0-

(-14,000)

21,700

(-260,800)

 

CME Feeder Index

CME Feeder Index* Dec. 26 Change
  $144.61 –   $1.68

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Dec. 27 Change
600-700 lbs. $154.54 –  $1.11
700-800 lbs. $149.49 + $0.71
800-900 lbs. $148.69 + $2.97

 

Prior Week South Central

Steers-Cash Dec. 20 Change
500-600 lbs. $156.87 + $6.28
600-700 lbs. $145.81 + $1.25
700-800 lbs. $146.15 + $2.43

 

Prior Week Southeast

Steers-Cash Dec. 20 Change
400-500 lbs. $150.05 + $3.48
500-600 lbs. $140.49 + $6.72
600-700 lbs. $133.19 + $0.71

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Dec. 27 ($/cwt) Change
Choice $208.96 –  $0.74
Select $204.57 + $3.54
Ch-Se Spread $4.39 –  $4.28

 

Futures

Feeder Cattle  Dec. 27 Change
Jan ’20 $145.550 + $1.275
Mar $144.800 + $0.425
Apr $147.200 + $0.700
May $148.500 + $1.025
Aug $153.325 + $1.050
Sep $153.950 + $1.350
Oct $153.800 + $0.500
Nov $153.00 + $0.500

 

Live Cattle   Dec. 27 Change
Dec $123.500 + $1.275
Feb ’20 $126.700 + $0.900
Apr $127.775 + $1.050
Jun $119.100 + $0.975
Aug $116.650 + $0.825
Oct $118.375 + $0.875
Dec $120.650 + $0.875
Feb ’21 $122.250 + $0.725
Apr $122.900 + $0.800

 

Corn  Dec. 27 Change
Mar ’20 $3.900 + $0.024
May $3.966 + $0.026
Jul $4.026 + $0.032
Sep $4.022 + $0.028
Dec $4.034 + $0.018
Mar ’21 $4.122 + $0.012

 

Oil CME-WTI Dec. 27 Change
Feb $61.72 + $1.28
Mar $61.53 + $1.28
Apr $61.21 + $1.26
May $60.79 + $1.24
Jun $60.28 + $1.21
Jly $59.70 + $1.16

 

Equities

Equity Indexes Dec. 27 Change
Dow Industrial Average  28645.26 + 190.17
NASDAQ   9006.72 +   81.66
S&P 500   324o.02 +    18.80
Dollar (DXY)        97.01 –       0.67
Cattle Current Weekly Highlights—Week ending Dec. 27, 2019 2019-12-28T16:14:13-06:00

Cattle Current Weekly Highlights—Week ending Dec. 20, 2019

Cash calf and feeder cattle prices gained momentum last week as buyers took advantage of some of the last auctions of the year.

Steers and heifers sold $2-$4/cwt. higher with instances of $5-$6 higher, according to the Agricultural Marketing Service (AMS).

“Demand was good for many calves, with very good demand for all yearlings offered,” say AMS analysts. “This was the last marketing opportunity for 2019 as a majority of auction barns will be closed until after the New Year’s holiday.”

Except for 45¢ and 5¢ higher in the back two contracts, Feeder Cattle futures closed an average of $1.16 lower week to week on Friday (40¢ lower toward the back to $1.87 lower near the front).

“Feeder cattle prices have been holding fairly steady and the futures market has some optimism priced in, but much of that optimism does not come about until the summer of 2020,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “The winter and spring prices on feeder cattle are likely profitable for stocker producers who got the cattle bought fairly inexpensively and were able to keep them alive, but it is doubtful that anyone will have windfall profits from the turn.”

AMS analysts note moisture is still lacking in winter wheat areas.

Feedlot Placements Up

Although higher feedlot placements were anticipated, Friday’s monthly Cattle on Feed report could apply some pressure.

November placements in feedlots with 1,000 head or more capacity were 2.09 million head, which was 4.86% more than the prior year. Heading into the report, consensus view of analysts was for an increase of 1%.

Marketings in November were on par with expectations at 1.81 million head, which was 3.00% less than the prior year.

Likewise, the on-feed inventory Dec. 1 was close to expectations at 12.03 million head, which was 2.49% more than a year earlier.

Fed Cattle Prices Move Higher

Negotiated cash fed cattle prices were generally $1 higher on a live basis last week: $120/cwt. in the Southern Plains; $120-$121 in Nebraska and the western Corn Belt. Dressed sales were $2-$4 higher at $192.

“This week’s live cattle price is the highest for finished cattle since early May, and it will provide a little momentum heading into winter and early spring,” Griffith says. “With the price of finished cattle starting to gain some steam, feedlot operators will be able to focus more of their attention on cattle health and pen conditions.”

Live Cattle futures closed an average of 66¢ lower (12¢ to $1.75 lower).

Harvest flows continue to return to normalcy after resumed operations at the Tyson plant in Kansas. According to AMS, estimated cattle slaughter for the week was 668,000 head, which was 6,000 more than the previous week and 8,000 head more than a year earlier.

After a false start a week earlier, wholesale beef values may have carved out a seasonal bottom. Choice boxed beef cutout value was $6.59 lower week to week on Friday at $209.70/cwt. Select was $3.21 lower at $201.03.

“The market is now shifting from strong demand for middle meats for the holidays to end cuts that will be slow cooked during the winter months. The part of the market that remains unknown, as it is every year, is the winter weather,” Griffith explains. “Severe weather that influences travel in densely populated areas generally slows beef consumption and movement. The hope for the beef market is that winter storms do not wreak havoc on cattle or consumers.”

Friday to Friday Change*

Weekly Auction Receipts

 

Dec.20 Auction Direct

Video/net

Total
 

223,000

(-124,200)

45,500

(+11,100)

14,000

(+12,100)

282,500

(-101,000)

 

CME Feeder Index

CME Feeder Index* Dec. 19 Change
  $146.29 +  $2.89

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Dec. 20 Change
600-700 lbs. $155.65 + $4.08
700-800 lbs. $148.78 + $1.25
800-900 lbs. $145.72 + $2.42

 

South Central

Steers-Cash Dec. 20 Change
500-600 lbs. $156.87 + $6.28
600-700 lbs. $145.81 + $1.25
700-800 lbs. $146.15 + $2.43

 

Southeast

Steers-Cash Dec. 20 Change
400-500 lbs. $150.05 + $3.48
500-600 lbs. $140.49 + $6.72
600-700 lbs. $133.19 + $0.71

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Dec. 20 ($/cwt) Change
Choice $209.70 –  $6.59
Select $201.03 –  $3.21
Ch-Se Spread $8.67 –  $3.38

 

Futures

Feeder Cattle  Dec. 20 Change
Jan ’20 $144.275 –  $1.400
Mar $144.375 –  $1.875
Apr $146.500 –  $1.550
May $147.475 –  $1.125
Aug $152.275 –  $0.625
Sep $152.600 –  $0.400
Oct $153.300 + $0.450
Nov $152.500 + $0.050

 

Live Cattle   Dec. 20 Change
Dec $122.225 –  $0.150
Feb ’20 $125.800 –  $1.750
Apr $126.725 –  $1.475
Jun $118.125 –  $1.300
Aug $115.825 –  $0.575
Oct $117.500 –  $0.175
Dec $119.775 –  $0.125
Feb ’21 $121.525 –  $0.250
Apr $122.100 –  $0.175

 

Corn  Dec. 20 Change
Mar ’20 $3.876 + $0.066
May $3.940 + $0.060
Jul $3.994 + $0.058
Sep $3.994 + $0.064
Dec $4.016 + $0.064
Mar ’21 $4.110 + $0.060

 

Oil CME-WTI Dec. 20 Change
Feb $60.44 + $0.46
Mar $60.25 + $0.58
Apr $59.95 + $0.69
May $59.55 + $0.75
Jun $59.07 + $0.74
Jly $58.54 + $0.71

 

Equities

Equity Indexes Dec. 20 Change
Dow Industrial Average  28455.09 + 319.71
NASDAQ   8924.96 +  190.08
S&P 500   3221.22 +   52.42
Dollar (DXY)        97.68 +     0.50
Cattle Current Weekly Highlights—Week ending Dec. 20, 2019 2019-12-21T16:08:10-06:00

Cattle Current Weekly Highlights—Week ending Dec. 13, 2019

Steers and heifers sold steady to $3/cwt. lower last week, according to the Agricultural Marketing Service (AMS).

“Demand was moderate to good in most regions as cattle feeders looked to fill orders to take advantage of the market reflected in the 2020 CME Live Cattle contracts,” said AMS analysts. “With the holidays and end of the year fast approaching, many auction barns had heavy runs as marketing opportunities will be limited after next week.”

In Tennessee, for instance, Andrew P. Griffith notes auction receipts were atypically high the last couple of weeks.

“Many producers that hold onto cattle into December generally hold them until the beginning of the next year since there is generally a bump in prices and for tax reasons,” Griffith explains, in his weekly market comments. “What makes strong receipts even more puzzling is that soft prices continue to dominate the market. Many cattle producers continue to be disappointed in calf and feeder cattle prices but continue to sell calves.” He expects resource constraints are part of the explanation.

Feeder Cattle futures closed an average of $3.06 higher week to week on Friday ($1.45 higher toward the back to $4.57 higher near the front).

Negotiated cash fed cattle trade continued to develop through Friday afternoon at no worse than steady money, according to USDA reports. Early live sales were at $119/cwt. in Nebraska and at $120 in the western Corn Belt. Early dressed sales were steady in the western Corn Belt at $188 and as much as $6 higher in Nebraska at $188-$194. Earlier in the week, live sales were steady in Kansas at $119. The Texas Cattle Feeders Association reported its members selling steers steady at $119 and heifers $1 higher at nearly $119.

Live Cattle futures closed an average of $1.94 higher week to week on Friday ($1.42 to $2.85 higher).

In the latest monthly World Agricultural Supply and Demand Estimates, USDA increased the projected average fed steer price (5-area-direct) in the fourth quarter by $3 to $115/cwt., compared to the previous month. The estimated annual average price for 2019 increased $1 to $117.

For next year, the average fed steer price is projected $2 higher at $122 in the first-quarter; $1 higher in the second quarter at $118; $1 lower in the third quarter at $112. Next year’s annual average price was estimated $1 higher at $117.

Wholesale beef values continued searching for a seasonal bottom. Choice boxed beef cutout value was $8.27 lower week to week on Friday at $216.29/cwt. Select was $3.06 lower at $204.24.

“The all fresh beef retail value registered at $5.82/lb. in November which is 4.5¢ higher than the previous month and nearly 12¢ higher than November a year ago,” Griffith says. “The Choice beef retail value for November was even more impressive as it was $6.06/lb., which represented more than a 17¢ increase from October and a 15¢ increase from one year ago. The expectation could be for retail value of beef to continue escalating given that wholesale beef prices in November were 7.7% percent higher than the previous month. Another factor that may soon influence retail beef prices is the announced deal with China that sent equity markets soaring. It is difficult to fathom that a deal with China will result in a lot of U.S. beef going to China, but it could help clear some pork and poultry stocks which would pull down some of the meat protein stocks. This is a situation that is worthy of beef cattle producers’ attention as it could provide sup-port or continue to weigh on the market.”

Friday to Friday Change*

Weekly Auction Receipts

 

Dec. 13 Auction Direct

Video/net

Total
 

347,200

(+60,300)

34,400

(+8,400)

1,900

(-54,800)

383,500

(+13,900)

 

CME Feeder Index

CME Feeder Index* Dec. 12 Change
  $143.40 –  $1.09

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Dec. 13 Change
600-700 lbs. $151.57 –  $0.50
700-800 lbs. $145.33 –  $1.43
800-900 lbs. $144.65 –  $1.68

 

South Central

Steers-Cash Dec. 13 Change
500-600 lbs. $150.59 –  $4.73
600-700 lbs. $144.56 –  $1.28
700-800 lbs. $143.73 + $0.06

 

Southeast

Steers-Cash Dec. 13 Change
400-500 lbs. $146.57 –  $0.58
500-600 lbs. $133.77 –  $3.59
600-700 lbs. $132.48 + $0.88

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Dec. 13 ($/cwt) Change
Choice $216.29 –  $8.27
Select $204.24 –  $3.06
Ch-Se Spread $12.05 –  $5.21

 

Futures

Feeder Cattle  Dec. 13 Change
Jan ’20 $145.675 + $4.125
Mar $146.250 + $4.575
Apr $148.050 + $4.275
May $148.600 + $3.525
Aug $152.900 + $2.825
Sep $153.000 + $2.100
Oct $152.850 + $1.450
Nov $152.450 + $1.600

 

Live Cattle   Dec. 13 Change
Dec $122.375 + $2.175
Feb ’20 $127.550 + $2.575
Apr $128.200 + $2.850
Jun $119.425 + $2.275
Aug $116.400 + $1.700
Oct $117.675 + $1.550
Dec $119.900 + $1.425
Feb ’21 $121.775 + $1.425
Apr $122.275 + $1.525

 

Corn futures Dec. 13 Change
Dec $3.662 –  $0.002
Mar ’20 $3.810 + $0.044
May $3.880 + $0.056
Jul $3.936 + $0.070
Sep $3.930 + $0.064
Dec $3.952 + $0.050

 

Oil CME-WTI Dec. 13 Change
Jan ’20 $60.07 + $0.87
Feb $59.98 + $0.88
Mar $59.67 + $0.89
Apr $59.26 + $0.89
May $58.80 + $0.88
Jun $58.33 + $0.90

 

Equities

Equity Indexes Dec. 13 Change
Dow Industrial Average  28135.88 + 120.82
NASDAQ   8734.88 +   78.35
S&P 500   3168.80 +   22.89
Dollar (DXY)        97.18 –      0.50
Cattle Current Weekly Highlights—Week ending Dec. 13, 2019 2019-12-14T19:11:55-06:00

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