Cattle futures firmed Monday with stronger wholesale beef prices after early pressure from last week’s wobbly cash fed cattle prices.
Heading into the close, Live Cattle futures were an average of 19¢ higher, except for 62¢ lower in away Aug. Feeder Cattle futures were narrowly mixed from an average of 13¢ lower in the front four contracts to an average of 39¢ higher.
Negotiated cash fed cattle trade ranged from mostly inactive on very light demand to a standstill through Monday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
Last week, FOB live prices were $1 lower in the Southern Plains at $186/cwt., $2 lower in Nebraska at $190 and steady to $2 lower in the western Corn Belt at $188-$192. Dressed delivered prices in Nebraska were $3 lower at $301 and $2-$3 lower in the western Corn Belt at $300-$301.
The five-area weighted average direct FOB live steer price last week was $1.18 lower at $188.91. The weighted average dressed delivered steer price was $2.68 lower at $300.81.
Choice boxed beef cutout value was $2.40 higher Monday afternoon at $315.60/cwt. Select was $1.99 higher at $303.70/cwt.
Grain futures continued lower Monday as crop progress brightens.
Heading into the close, through Jly ‘25, Corn futures were mostly 3¢ to 4¢ lower. Kansas City Wheat futures 6¢ to 9¢ lower. Soybean futures were 15¢ to 20¢ lower.
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Major U.S. financial indices closed mixed Monday and well off of session lows with pressure from indications of weakness in the manufacturing sector causing concerns about domestic economic growth.
The Dow Jones Industrial Average closed 115 points lower. The S&P 500 closed 5 points higher. The NASDAQ was up 93 points.
Heading toward the close West Texas Intermediate Crude Oil futures on the CME were $2.44 to $2.88 lower through the front six contracts, pressured by news that OPEC+ plans to phase out voluntary production cuts.
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The five-area weighted average direct FOB live steer price last week was $1.18 lower at $188.91/cwt. The weighted average dressed delivered steer price was $2.68 lower at $300.81.
“It would appear the summer lull in finished cattle prices may hit the market earlier than normal and stay with the market longer than is typical,” says Andrew P. Griffith, agricultural economist with the University of Tennessee, in his weekly market comments. “If this occurs then it will pull on feeder cattle and calf prices. If the market is able to trade steady, then it would be tremendous support for the rest of the market. The one positive to support finished cattle prices is the declining number of cattle in feedlots. As this number continues tightening, competition should improve.”
As beef packers slow production in an effort to support wholesale beef values, Griffith also notes the contribution of byproducts.
“The hide and offal value has been between $11 and $12/cwt. This value essentially adds these same dollars to the live animal,” Griffith explains. “In other words, if there was no value in the hide and offal, packers would have to pay $11 to $12/cwt. less for a finished animal.”
Griffith adds weekly average hide and offal values have been $1.57/cwt. less year over year for the first five months of 2024.