Cattle futures were lower Thursday with dimming cash fed cattle price prospects, unwinding wholesale beef values, more bearish outside markets and perhaps positioning ahead of the monthly Cattle on Feed report due out Friday. Ahead of the report, analysts see January placement 3% higher year over year, January marketings about 2% higher and the on-feed inventory Feb. 1 at about 99%.
Toward the close, Live Cattle futures were an average of 65¢ lower, except for unchanged in spot Feb. Feeder Cattle futures were an average of $1.11 lower, except 20¢ higher in Nov.
Negotiated cash fed cattle trade ranged from a standstill in the Texas Panhandle to light on light demand elsewhere through Thursday afternoon, according to the Agricultural Marketing Service. There were a few FOB live trades in Kansas at $199/cwt., and a few dressed delivered trades in Nebraska at $315, but too few transactions to trend in any region.
Last week, FOB live prices were $203/cwt. in all regions. Dressed delivered prices were $320-$321.
Choice boxed beef cutout value was $1.26 lower Thursday afternoon at $312.63/cwt. Select was 58¢ lower at $303.18.
Soybean futures led Corn futures higher Thursday amid chatter from the White House that a trade deal with China could get done.
Toward the close and through Sep ’25 contracts, Soybean futures were 9¢ to 13¢ higher. Corn futures were unchanged to 6¢ higher. Kansas City Wheat futures were 5¢ to 6¢ lower.
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Major U.S. financial indices closed lower Thursday, pressured by retail stocks, including Walmart.
The Dow Jones Industrial Average closed 450 points lower. The S&P 500 closed 26 points lower. The NASDAQ was down 93 points.
Through mid-afternoon, West Texas Intermediate Crude Oil futures on the CME were 28¢ to 45¢ higher through the front six contracts.
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Analysts with USDA’s Economic Research Service (ERS) provide further context to the cattle inventory and beef cow herd at the beginning of this year, in the latest Livestock, Dairy and Poultry Outlook.
“The culling rate of beef cows in 2024 was over 10% of the beef cow inventory on Jan. 1, 2024, a 2% decline from last year and the lowest since 2019,” ERS analysts explains “For additional context, the number of beef cows is down 39% from the historic peak set in 1975 of 45.712 million head and is the smallest beef cow inventory since 1961. As the number of beef heifers available for addition to the herd is correlated to the size of the beef cow herd and the previous year’s calf crop, beef heifer replacements also peaked in 1975 at 8.884 million head and have since fallen 47%.”
As for expansion potential, considering the last three cattle cycles — including the beginning of the current one — ERS analysts explain the percentage of beef heifers kept for replacements in the coming year had several years of increasing proportions year-over-year, compared to the previous year’s calf crop.
“If the same pattern holds in the future, it could be several years from now before the U.S. cattle herd expands,” ERS analysts say. “Biologically speaking, many of the offspring from heifers born in 2024 would not enter the beef cow herd until the 2027. Historically high prices for calves
likely encouraged many producers to market their heifer calves to the feeder market in 2024.”