Cattle futures fell hard Thursday as outside markets initially plummeted in response to Russia’s invasion of Ukraine, although they did close off of session lows.
Feeder Cattle futures closed an average of $2.91 lower, from $1.90 to $4.47 lower.
Live Cattle futures closed an average of $2.05 lower, from $1.12 to $2.52 lower.
So far this week, though, negotiated cash fed cattle prices are firm to higher with live prices steady in the Southern Plains at $142/cwt., $2 higher in Nebraska at $144 and steady to $3 higher in the western Corn Belt at $144-$145. Dressed prices are $1 higher in Nebraska at $227 and steady to $1 higher in the western Corn Belt at $226-$227.
Trade was slow on light demand in all major cattle feeding regions through Thursday afternoon, according to the Agricultural Marketing Service.
Choice Boxed beef cutout value was 76¢ lower Thursday afternoon at $260.88/cwt. Select was $4.68 lower at $258.96.
Grain and soybean futures were widely volatile as traders came to grips with the war in eastern Europe, as well as U.S. baseline projections released as part of the annual Agricultural Outlook Forum (see below).
Corn futures closed 4¢ to 9¢ higher in the front three contracts and then 6¢ to 15¢ lower.
Soybean futures closed mostly 23¢ to 36¢ lower.
******************************
Although major U.S. financial indices managed to close higher Thursday, they plumbed sharply lower during the session amid fears and uncertainty stemming from Russia’s military aggression in neighboring Ukraine.
The Down Jones Industrial Average closed 92 points higher. The S&P 500 closed 63 points higher. The NASDAQ was up 463 points.
******************************
USDA expects more moderate feed prices later this year and slightly less total red meat and poultry production.
“In the first part of the year, steer and heifer slaughter will likely remain near last year’s levels, as current feedlot inventories are marketed. As the year progresses, however, marketings will decline as feedlot numbers diminish,” according to analysts with USDA’s World Agricultural Outlook Board (WAOB). “Additionally, cow slaughter is expected to decline due to lower inventories and expectations that any response to improving returns or forage will likely be manifest in producers retaining cows later in the year. Heavier cattle weights, which is a function of expected demand for higher-grading fed cattle as well as a decreasing proportion of cows in the slaughter mix during 2022, will only partly offset lower slaughter numbers.”
That’s from the Livestock and Poultry Outlook presented during this year’s Agricultural Outlook Forum.
Commercial beef production for this year is forecast to be 2% less than last year at 27.38 billion lbs. Total red meat and poultry production is projected to decrease fractionally to 106.6 billion lbs. Although fractional, WAOB analysts note the decline would be the first decline since 2014.
“Feed prices during 2022 are likely to be slightly lower than 2021. Corn prices in the first part of 2022 are expected to be above a year ago reflecting a forecast 2021-22 crop year average of $5.45/bu. However, prices later in the year are expected to be below 2021, reflecting a decline in the season-average price to $5.00/bu. for 2022-23,” say WAOB analysts. “Soybean meal prices in the first part of 2022 will reflect a 2021-22 crop year average of $410 per ton and prices in the fourth quarter are expected to reflect a market year forecast of $375 for 2022-23.”