Cattle futures rallied higher Friday helped along by recently stronger wholesale beef values.
Live Cattle futures closed average of $1.11 higher (65¢ to $1.95 higher).
Feeder Cattle futures closed an average of $1.67 higher (50¢ higher at the back to $3.32 higher at the front).
Negotiated cash fed cattle trade ranged from mostly inactive on light demand to slow on light demand through Friday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
Last week, FOB live prices were $2 lower in the Southern Plains at $180/cwt., steady to $2.50 lower in Nebraska at $180 and steady in the western Corn Belt at $180-$182. Dressed delivered prices were unevenly steady in Nebraska at mostly $287 and steady in the western Corn Belt at $285.
Choice boxed beef cutout value was 90¢ higher Friday afternoon at $296.20/cwt. Select was $1.33 lower at $286.66/cwt.
Total estimated cattle slaughter last week of 608,000 head was 14,000 head fewer than the previous week and 17,000 head fewer than the same week last year. Total year-to-date estimated cattle slaughter of 4.2. million head was 246,000 head fewer (-5.6%). Year-to-date estimated beef production of 3.5 billion pounds was 153.5 million pounds less (-4.2%).
Corn futures closed mostly 1¢ to 2¢ higher.
KC HRW Wheat futures closed 8¢ to 11¢ lower.
Soybean futures closed mostly 5¢ to 10¢ higher.
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Major U.S. financial indices closed lower on Friday with another report indicating stubborn inflation.
The Producer Price Index for final demand increased 0.3% in January, seasonally adjusted, according to the U.S. Bureau of Labor Statistics. That was more than expected.
The Dow Jones Industrial Average closed 145 points lower. The S&P 500 closed 24 points lower. The NASDAQ was down 130 points.
West Texas Intermediate Crude Oil futures (CME) closed 54¢ to $1.16 higher through the front six contracts.
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Depending on your abacus, the USDA Agricultural Projections to 2033 released last week are plumb optimistic when it comes to the timing and degree of U.S. beef cow herd growth.
USDA pegs the Jan. 1, 2025 beef cow inventory at 28.82 million head, which would be 600,000 head more than Jan. 1 this year. USDA projects the beef cow herd growing to a peak of 31.68 million head in 2031, which would be 3.5 million head more than where this year began.
“Beef production is projected to increase during much of the forecast period as assumptions of normal weather and improved pastures, coupled with strong cattle prices, sets the stage for herd rebuilding,” according to the report. “Beef production is expected to decline in 2024 reflecting tighter cattle supplies leading into the projection period. However, higher expected cattle prices in 2024 and an expected return to normal pasture conditions will likely incentivize heifer retention, after which modest herd growth is expected through the end of the projection period.”
USDA projects the annual feeder steer price (750-800 lbs., Oklahoma City) to peak this year at $253.75/cwt. and at $246.34 next year. After that prices are projected to decline to a low of $159.78 in 2030 before increasing again.
USDA forecasts the weighted average annual five-area direct fed steer price at $185.00 this year and $180.60 next year before declining to a low of $128.78 in 2030.
“Corn prices are projected to decline from the elevated levels in 2022/23 and 2023/24, and corn planted acreage is projected to fall from 94.9 million acres in 2023/24 to 91 million acres in 2024/25, according to the report. Prices start at $4.50 per bushel in 2024/25 and then level off at $4.30 per bushel the remainder of the projection period.”
U.S. real GDP growth is projected at an annual average of 1.9% during the projection period from 2024–33.