Weaker corn futures and an uptick in wholesale beef prices helped lift Cattle futures Wednesday.
Feeder Cattle futures closed an average of 77¢ higher.
Live Cattle futures an average of 39¢ higher.
Negotiated cash fed cattle trade and demand ranged from inactive on very light demand to a standstill through Wednesday afternoon, according to the Agricultural Marketing Service.
Last week, FOB live prices were $180/cwt. in the Southern Plains and $188 in Nebraska and the western Corn Belt. Dressed prices were $295 in a light test.
Choice boxed beef cutout value was $1.13 higher Wednesday afternoon at $303.52/cwt. Select was $1.98 higher at $278.14/cwt.
Favorable weather, and perhaps skittishness ahead of Friday’s WASDE, pressured grain futures on Wednesday.
Corn futures closed mostly 1¢ to 4¢ lower.
KC HRW Wheat closed mostly 3¢ to 6¢ lower.
Soybean futures closed 1¢ to 4¢ higher through Aug ‘24 and then mostly fractionally higher.
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Major U.S. financial indices closed lower again Wednesday, perhaps defensive pressure ahead of Thursday’s next read on inflation — the monthly CPI.
The Dow Jones Industrial Average closed 191 points lower. The S&P 500 closed 31 points lower. The NASDAQ was down 162 points.
West Texas Intermediate Crude Oil futures (CME) closed $1.03 to $1.48 higher through the front six contracts, supported by chatter about reduced global production.
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Although seasonally lower, wholesale beef prices continue at what some would consider a remarkably high and consistent level.
“Since the middle of April, the weekly comprehensive boxed beef cutout price has only traded outside of an $8 range for a four-week period in June and early July,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “The cutout has spent most of its time trading on either side of $300/cwt. and there are no signs it will deviate in the near term.”
Griffith explains the loin and rib primals were the primary price drivers in June, while brisket also demonstrated strength in late June and early July.
“Middle meat prices softened through July, which is the primary reason the cutout fell off its June highs,” Griffith explains. “However, the brisket and short plate also contributed to some of the boxed beef cutout price decline. Alternatively, the chuck, round and flank primal prices have held their own the past month and continue to offer support for the comprehensive cutout.”
Although middle meats may gather added interest heading into Labor Day, Griffith says prices will likely soften again heading into the late summer and the fall months.