Cattle futures firmed and gained Thursday with more trader interest and perhaps more confidence wholesale price volatility may be gentler.
Feeder Cattle futures closed an average of $1.62 higher ($1.15 to $2.75 higher).
Live Cattle futures closed an average of 42¢ higher (10¢ to 57¢ higher), except for 10¢ lower in the back contract.
Corn futures closed mostly 1¢ lower, except for 1¢ to 4¢ higher in the front four contracts.
Soybean futures closed mixed, 2¢ to 14¢ higher through Sep ’23 and then mostly 1¢ to 3¢ lower.
Negotiated cash fed cattle trade ranged from light on moderate demand in the Texas Panhandle to limited on moderate demand in the other regions through Thursday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
Live prices were $1 lower in Nebraska on Wednesday at $156/cwt. and dressed prices were $1-$2 lower at $247.
Last week, live prices were at $155 in the Southern Plains and $157-$158 in the western Corn Belt where dressed prices were $248-$249.
Choice Boxed beef cutout value was $1.68 lower Thursday afternoon at $247.28/cwt. Select was 78¢ higher at $220.55/cwt.
Major U.S. financial indices ended their recent skid Thursday. Apparently, it was a situation of bad news being good news. In this case, weekly unemployment insurance claims were a bit higher than expected.
Seasonally adjusted initial claims for the week ending Dec. 3 were 4,000 more than the previous week at 230,000. The advance number for seasonally adjusted insured unemployment during the week ending Nov. 26 was 1.67 million, which was 62,000 more than the previous week’s revised level, according to the U.S. Department of Labor.
The Dow Jones Industrial Average closed 183 points higher. The S&P 500 closed 29 points higher. The NASDAQ was up 123 points.
West Texas Intermediate Crude Oil futures (CME) closed 55¢ to 82¢ lower through the front six contracts.
Earlier this week, the U.S. Department of Agriculture published the final rule that will require packers to submit contractual information for the purchase of cattle. The rule applies to beef packers that slaughtered an average of not less than 5% of the number of fed cattle slaughtered nationally during the immediately preceding five calendar years.
The rule stems from the Consolidated Appropriations Act of 2022, which directed the Agricultural Marketing Service (AMS) to create a Cattle Contracts Library Pilot Program (library) to increase market transparency for cattle producers.
Publication of the final rule, which goes into effect on Jan. 6, 2023, aims to ensure complete reporting of contractual information and volumes purchased against the contracts, including: supplemental information on cattle requirements; associated schedules of premiums and discounts; delivery and transportation terms and payments; appendices and agreements of financing, risk-sharing, or profit sharing; or other financial arrangements associated with such contracts, whenever new contracts are offered, or existing contracts are updated.
“We are pleased that USDA listened to feedback from stakeholders like NCBA while crafting the final rule on the Cattle Contract Library Pilot Program. We are hopeful that this pilot program will strike an appropriate balance between offering cattle producers additional insight into the market while also protecting their proprietary business information,” says Tanner Beymer, Senior Director of Government Affairs for the National Cattlemen’s Beef Association (NCBA). “A Cattle Contract Library is just one of many tools NCBA has advocated for to help producers make informed business decisions and capture the most value possible for their cattle.”
All information related to the library pilot is posted on the AMS Cattle Contract Library webpage here.