Cattle Current Daily—Dec. 6, 2024

Cattle Current Daily—Dec. 6, 2024

Cattle futures weakened further Thursday sans weekly cash fed cattle direction and sluggish Choice wholesale beef values.

Toward the close, Feeder Cattle futures were an average of $1.88 lower. Live Cattle futures were an average of $1.66 lower.

Negotiated cash fed cattle trade ranged from mostly inactive on light demand in the Southern Plains to slow on light demand in the North through Thursday afternoon with too few transactions to trend, according to the Agricultural Marketing Service.

Last week, FOB live prices were $190/cwt. in the Southern Plains, $190-$192 in Nebraska and $185-$190 in the western Corn Belt. Dressed delivered prices were $290 in Nebraska and $294-$305 in the western Corn Belt.

Choice boxed beef cutout value was 49¢ lower Thursday afternoon at $307.84/cwt. Select was 60¢ lower at $277.10.

Grain and Soybean futures closed higher Thursday.

Toward the close and through Sep ’25 contracts, Corn futures were mostly 3¢ to 5¢ higher, supported by weekly export sales that were 63% more than the previous week and 4% more than the prior-four-week average. Kansas City Wheat futures were 10¢ to 11¢ higher. Soybean futures were 7¢ to 10¢ higher.

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Major U.S. financial indices closed lower Thursday with apparent investor skittishness ahead of Friday’s national jobs report.

The Dow Jones Industrial Average closed 248 points lower. The S&P 500 closed 11 points lower. The NASDAQ was down 34 points.

Through midafternoon, West Texas Intermediate Crude Oil futures on the CME were 8¢ to 12¢ lower through the front six contracts.

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Given cow-calf profitability, hay production, hay prices and the current rates of beef cow and heifer slaughter, James Mitchell, Extension livestock economist at the University of Arkansas expects to see a 1% decline in beef cow inventories this year.

In terms of profitability, Mitchell shares estimated cow-calf returns over cash costs provided by the Livestock Marketing Information Center (LMIC).

“According to LMIC estimates, returns are projected at $622 per cow in 2024, making it the most profitable year on a nominal basis … surpassing the $534 per cow recorded in 2014,” Mitchell explains in the latest Cattle Market Notes Weekly. “However, comparisons are more meaningful when adjusted for inflation. When 2014 returns are converted to 2024 dollars, they equal $707 per cow, exceeding 2024 returns by $86 per cow.”

As for slaughter rates, beef cow slaughter — a measure of cow culling — is 18% less year over year, while heifer slaughter — a measure of heifer retention is 1.5% less, according to Mitchell.

“An important consideration is the slaughter rate relative to available supplies, rather than absolute cow and heifer slaughter numbers,” Mitchell says. “When viewed in this context, it becomes evident that the current slaughter rate has not yet reached a level signaling an increase in beef cow inventories. For example, in 2023 we slaughtered 12% of the beef cows that were available to slaughter as of January 1 (implied cull rate). In 2024, it looks like we will slaughter 10% of available beef cows. While this is an improvement, it still is not a low enough cull rate to signal an increase in beef cow numbers.”

2024-12-05T18:13:20-06:00

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