Cattle futures gained some Tuesday with a likely technical bounce.
At the close and before final settlement, Live Cattle futures closed an average of $1.26 higher, while Feeder Cattle futures closed an average of $1.94 higher.
Negotiated cash fed cattle trade was at a standstill through in all major cattle feeding regions through Tuesday afternoon, according to the Agricultural Marketing Service.
Last week, FOB live prices were $184/cwt. in the Texas Panhandle, $183-$184 in Kansas and $187 in the north. Dressed delivered prices were $296-$297 in Nebraska and $297 in the western Corn Belt.
Choice boxed beef cutout value was 2¢ higher Tuesday afternoon at $302.09/cwt. Select was 37¢ lower at $299.90.
Turning to row crops, positive weather outlooks in the U.S. and South America helped pressure grains Tuesday. Heading toward the close,
Corn futures were down 4¢ to 6¢ through Dec. ’25, Kansas City Wheat futures were mostly 6¢ to 13¢ lower through Dec ’25 and Soybean futures were mostly 6¢ lower through the front of the Board.
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Major U.S. financial indices closed narrowly mixed Tuesday.
The Dow Jones Industrial Average closed 9 points lower. The S&P 500 closed 7 points higher. The NASDAQ was up 52 points.
West Texas Intermediate Crude Oil futures (CME) were 61¢ to $1.15 lower through the front six contracts.
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Funds exiting long positions pulled the rug from under Cattle futures when Highly Pathogenic Avian Influenza was confirmed in dairy cattle and linked to a human case soon after. However, Stephen Koontz, agricultural economist at Colorado State University says some price adjustment should already have been expected.
Incidentally, because there is a difference, the American Association of Bovine Practitioners now refers to the virus as Bovine Influenza A Virus (BIAV).
“Beef packer margins are as poor as they have been for over a year. The first quarter typically has the poorest margins and that is where things are,” Koontz explains, in the latest issue of In the Cattle Markets from the Livestock Marketing Information Center. “Pressure to lower fed cattle prices remains to be expected. Cash cattle feeding margins are also relatively even compared to the strength observed in all of 2023. Under such conditions pressure on feeder cattle prices are anticipated. Given these underlying conditions, a rapid return to observed high price levels for fed cattle and calves is unlikely.”
Further, Koontz noted the inventory of cattle on feed for more than 150 days, as calculated from USDA reports, is among the most since the pandemic.
“Therefore, packer leverage in bargaining will remain strong into the second quarter, and the impetus for other heavy placements will be mitigated,” Koontz says. “It is rather possible that the spring market rally has occurred and is over.”