Negotiated cash fed cattle trade was at a standstill in all major regions through Monday afternoon, according to the Agricultural Marketing Service.
Last week, live prices were at $122-$123/cwt. in the Southern Plains at $123/cwt. Live and dressed sales were at $128 and $202-$208, respectively, in Nebraska and the western Corn Belt.
Lower Corn futures helped boost Feeder Cattle futures Monday. They closed an average of 62¢ higher (10¢ to $1.75), except for spot Sep, down 60¢.
Recent sluggishness in the pace of packer buying continued to pressure Live Cattle futures again Monday. They closed an average of 57¢ lower (18¢ to $1.75).
Choice boxed beef cutout value was $2.56 lower Monday afternoon at $342.78/cwt. Select was $2.97 lower at $312.55/cwt.
Front-month Corn and Soybean futures fell hard with barge delivery uncertainty stemming from Hurricane Ida.
Corn futures closed 6¢ to 17¢ lower through new-crop contracts and then mostly 3¢ lower.
Soybean futures closed 11¢ to 54¢ lower in the front seven contracts and then mostly 4¢ to 7¢ lower.
Major U.S. financial indices closed mixed on Monday, with tech stocks pushing the S&P 500 to its 12th all-time high in August. The after-effects of Hurricane Ida pushed gasoline higher but hurt insurers.
The Dow Jones Industrial Average closed 56 points lower. The S&P 500 19 points higher. The NASDAQ was up 136 points.
Logic and current calf prices suggest the nation’s calf crop may be less than what USDA estimated in the semiannual Cattle report released last month, according to the Livestock Marketing Information Center (LMIC).
“Steer calf prices in the Southern Plains have been robust in 2021. Calves weighing 500-600 lbs. have averaged between 6% and 16% higher from June through mid-August. The calf market is incredibly hot, given the higher cost of feed,” say LMIC analysts, in the latest Livestock Monitor. “Reports of droughts and liquidation would have implied early weaning was a given in 2021 but the data has shown little signs that is happening to a large degree.”
For instance, they point to the most recent monthly Cattle on Feed report, which pegged 15% fewer July placements weighing less than 700 lbs., compared to the previous year.
“High feed costs should drive calf prices lower, reducing the incentive to place lighter weight cattle into feedlots. Drought affected areas should have started early weaning and shipped more small animals to feedlots,” say LMIC analysts. “Given the limited forage and high hay costs, it would seem likely that more calves would be moving at these prices that are substantially higher than a year ago. These incongruent signals point towards a smaller calf crop (July 1 estimate). That would explain both the higher prices and limited number of placements seen in July. August might show greater movement of smaller feeders, and the timing may be slower than initially thought.”