Negotiated cash fed cattle prices ended the week $1 lower in the Southern Plains at $105/cwt. on a live basis, $1.50 lower in Nebraska at $105 and $2 lower in the western Corn Belt at $104-$107. Dressed trade was $2-$3 lower at mostly $167.
Through Thursday, the five-area direct weighted average steer price was $105.12/cwt. on a live basis, which was $1.50 lower than the previous week. The weighted average dressed steer price of $166.52 was $2.59 less.
Cattle futures continued to soften Friday, with follow-through pressure from the week’s lower cash prices and outlook for declining wholesale beef values.
Other than 25¢ higher in almost spent spot Aug, Live Cattle futures closed an average of 72¢ lower.
Feeder Cattle futures closed an average of $1.02 lower from 22¢ lower at the back to $1.30 lower.
Choice boxed beef cutout value was $2.14 lower Friday afternoon at $229.40/cwt. Select was 60¢ higher at $214.86.
Estimated total cattle slaughter for the week ending Aug. 29 of 654,000 head was 2,000 more than the previous week’s estimate and 1,000 head more than the same time a year earlier. Year-to-date cattle slaughter is estimated at 20.99 million head, which would be 1.06 million fewer (-4.80%) than the same time last year. Estimated beef production so far this year is 17.36 billion lbs., which is 381.2 million lbs. less (-2.1%) than last year.
Corn futures closed mostly fractionally lower.
After 13¢ higher in spot Sep, Soybean futures closed mostly 6¢ to 8¢ higher
Major U.S. financial indices closed higher on Friday. Support included the previous day’s FOMC policy change allowing inflation to run above its 2% target rate without increasing interest rates. As well, U.S. consumer spending and income in July beat trade expectations.
Personal consumption expenditures increased 1.9% in July to $267.6 billion, according to the U.S. Bureau of Economic Analysis. Personal income increased 0.4% to $70.5 billion.
The Dow Jones Industrial Average closed 161 points higher. The S&P 500 closed 23 points higher. The NASDAQ closed 70 points higher.
Although sales by food-at-home retailers increased year over year since the pandemic began, total food sales remain lower, due to the decline in away-from-home food purchases, according to USDA’s Economic Research Service (ERS).
“In 2019, before the COVID-19 pandemic, U.S. consumers, businesses, and government entities spent an average of $137.4 billion per month on food,” explain ERS analysts. “Normal seasonal variations were present, with total food spending being lowest in January and February and highest in May, August, and December. Early 2020 followed the same pattern, with lower-than-average total food spending in January and February, but this trend continued into the spring with spending on food falling to $105 billion in April 2020, as spending at food-away-from-home establishments—restaurants, school cafeterias, sports venues, and other eating places—dropped to $36 billion. Spending on food-away-from-home rebounded in May and June but remained below 2019 spending in those months. Total food sales rose in May and June 2020 but were still lower than a year ago.”
For perspective, total food sales were $123 billion in May and $128 billion in June. For the same months last year, total food sales were $144 billion and $140 billion, respectively.