Higher outside markets and recently surging wholesale beef prices helped Cattle futures mostly extend gains Tuesday.
Feeder Cattle futures closed an average of 36¢ higher.
Live Cattle futures closed narrowly mixed, from an average of 24¢ higher in the front four contracts to an average of 17¢ lower through the back, except for unchanged in Aug.
Choice Boxed beef cutout value was $2.07 lower Tuesday afternoon at $254.95/cwt. Select was 22¢ lower at $225.46/cwt. But, Choice was $3.31 higher in the morning report and the previous day’s CME Boxed Beef Index was $1.52 higher.
Negotiated cash fed cattle trade ranged from mostly inactive on very light demand to mostly a standstill through Tuesday afternoon, according to the Agricultural Marketing Service.
Last week, live prices were at $153-$155/cwt. in the Texas Panhandle, $155-$156 in Kansas, $156-$158 in Nebraska, $157 in Colorado and $156 in the western Corn Belt. Dressed prices were $246-$247.
Corn futures closed mostly 1¢ lower.
Soybean futures closed 15¢ to 19¢ higher through Aug ‘23, and then 4¢ to 8¢ higher.
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Major U.S. financial indices rose again Tuesday with another hopeful sign that inflation is easing. The Consumer Price Index for All Urban Consumers rose 0.1% in November on a seasonally adjusted basis, after increasing 0.4% in October, according to the U.S. Bureau of Labor Statistics. The index was 7.1% higher over the last 12 months, less than the trade expected.
The Dow Jones Industrial Average closed 103 points higher. The S&P 500 closed 29 points higher. The NASDAQ was up 113 points.
West Texas Intermediate Crude Oil futures (CME) closed $1.83 to $2.22 higher through the front six contracts.
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Global beef production is forecast to decrease slightly in 2023, as declining beef production in the U.S. and European Union will more than offset increasing beef production in Australia, Mexico and India, says Derrell Peel, Extension livestock Marketing specialist at Oklahoma State University, in his weekly market comments. He adds that changing beef production and consumption will impact global beef exports and imports.
Brazil is expected to remain the largest beef exporter with beef production increasing slightly next year, according to Peel. He explains Brazilian exports are limited by decreased beef imports to China.
“Australia, after drought in recent years decreased cattle numbers and beef production, is now in rebuilding mode,” Peel explains. “Cattle prices are falling from historically high levels in Australia and beef exports are forecast to increase, helping Australia regain the number two spot.”
Declining beef production, higher beef prices and a continued strong dollar will likely make the U.S. the fourth largest beef exporter in 2023, according to Peel.