Grain markets Friday continued to adjust to the previous day’s Prospective Plantings report.
Soybean futures closed 5¢ to 35¢ lower across the board on more planted acres than expected.
New-crop Corn futures mostly gained again Friday, mostly 4¢ to 7¢ higher on fewer anticipated acres.
Rising feed costs once again helped pressure Feeder Cattle futures an average of $1.61 lower, except for 18¢ higher in spot April.
Cash calves and feeder cattle sold mixed last week, based on weekly auctions monitored by Cattle Current — mainly higher early, driven by demand for grass-suited cattle and then with more pressure later in the week with another bounce higher in Corn and full-to-the-brim feedlots.
“Feedlots will have plenty of cattle to market for another few months, but tighter placements are ahead and feedlot production will decline in the second half of the year, says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “If drought conditions persist, feedlots may perhaps continue to borrow against the future with early-weaned calves available through the spring and summer before facing the full reality of tighter feeder cattle supplies. On the other hand, if drought conditions abate, higher cattle prices might result in increased heifer retention by the end of the year, thereby squeezing feeder supplies even more and more quickly.”
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Negotiated cash fed cattle trade was mostly inactive on light demand in all major cattle feeding regions through Friday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
Live prices last week were steady in the Southern Plains at $138/cwt., steady to $2 higher in Nebraska at $138-$140/cwt. And $1-$2 higher in the western Corn Belt at $140-$143. Dressed prices were $1 higher in Nebraska at $222 and steady to $3 lower in the western Corn Belt at $222.
Estimated total cattle slaughter last week of 639,000 head was 20,000 head fewer than the previous week. Estimated year-to-date total cattle slaughter of 8.39 million head was 29,000 head more.
Estimated year-to-date beef production of 7.03 billion lbs. was 47.4 million lbs. more.
Live Cattle futures, closed an average of 64¢ lower, except for 10¢ to 30¢ higher in the back two contracts, challenged by volatile markets and the looming bulge in second-quarter fed cattle supplies amid limited shackle space once again.
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Major U.S. financial indices edged higher Friday, despite a slightly gloomier jobs report than anticipated.
Total non-farm payroll employment increased by 431,000 month-to-month in March, according to the U.S. Bureau of Labor Statistics.
The Dow Jones Industrial Average closed 140 points higher. The S&P 500 closed 15 points higher. The NASDAQ was up 41 points.
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Wholesale beef prices continue their seasonal push higher.
Choice boxed beef cutout value was $12.42 higher week to week on Friday at $267.14/cwt. Select was $13.41 higher at $262.52.
Beyond seasonal beef prices, consumers will continue to face sharp increases in retail meat prices.
“Relative to 2019, beef retail prices are projected to be 26% higher this year, with pork up 21% and chicken 18% more expensive,” according to the 2022 Agricultural Outlook from the Food and Agricultural Policy Institute (FAPRI) at the University of Missouri. “To this point consumers have continued to spend their dollars on meat, particularly higher-value products, but the risk of some consumers being priced out of the market is increasing. With energy and other goods taking a larger share of consumer finances, recent meat demand strength could be tested given projected price levels.”
Although meat prices have driven the trend toward higher food inflation, FAPRI analysts explain prices for other food products are also increasing.
“Even if food inflation slows in the months ahead, the annual rate for 2022 is likely to be the highest since 2008,” says Patrick Westhoff, FAPRI director. “Higher farm commodity and energy prices caused by the Ukraine war could make it more difficult for consumer food price inflation to return to normal levels in the near term.