Negotiated cash fed cattle trade continued with a lower undertone, Wednesday, although there were too few transactions to trend. A day earlier, live trade was $4-$5 lower week to week in the Southern Plains and Nebraska at $115/cwt. Dressed trade was $3-$5 lower at $185-$187.
There were 755 head offered in the weekly Fed Cattle Exchange auction—five lots from the Southern Plains. Four lots—627 head—sold for a weighted average price of $115.25/cwt.; 483 head for delivery at 1-9 days and 272 head for delivery at 1-17 days.
Choice steers and heifers sold $1.00-$1.50 lower at the fat auction in Tama, IA. There were 82 head of Choice 2-4 steers weighing an average of 1,457 lbs. and bringing an average price of $120.51. Country trade in the region last week was at $119-$120.
At Sioux Falls Regional in South Dakota, though, fat cattle sold $2-$4 lower with 176 Choice 2-3 steers weighing an average of 1,438 lbs., bringing an average of $116.84.
Cattle futures, especially Feeder Cattle, found some footing Wednesday, likely helped along by short covering.
Live Cattle futures closed mixed, from an average of 69¢ lower through the front four contracts to an average of 28¢ higher.
Except for 12¢ lower in Oct, Feeder Cattle futures closed an average of 80¢ higher (10¢ higher to $1.85 higher in Apr).
Wholesale beef values were lower on light demand and heavy offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was $1.13 lower Wednesday afternoon at $206.34/cwt. Select was $1.30 lower at $198.60.
Corn futures closed mostly fractionally lower to 2¢ lower.
Soybean futures closed mostly fractionally higher to 3¢ higher.
Despite an attempt at stability early on, major U.S. financial indices continued mainly lower again Wednesday, with persistent coronavirus fears.
The Dow Jones Industrial Average closed 123 points lower. The S&P 500 closed 11 points lower. The NASDAQ was up 15 points.
Hide prices and subsequent beef byproduct values continue under long-term pressure. Part of it has to do with sheer volume, but another part has to do with consumers choosing synthetics in the place of leather, sometimes with the mistaken belief that fake leather is more environmentally friendly.
“There is no better, more environmentally-friendly alternative to using hides from animals processed for food than to make real leather,” says Stephen Sothmann, president of the Leather and Hide Council of America (LHCA). “Without the leather industry, nearly 2 billion lbs. of unused cattle hides would be diverted to landfills, placing tremendous pressure on the environment that would be further compounded by the shift to synthetic imitations produced from plastic and other non-renewable sources.”
As it is, based on USDA data, Sothmann explains the U.S. processed more than 33 million head of cattle for food last year, but U.S. export data and industry estimates suggest approximately 27.5 million U.S. cattle hides were used in domestic and global leather production. So, about 17% of U.S. cattle hides last year were destroyed or discarded in landfills.
Those discarded or destroyed hides could have been used to produce leather for approximately 99 million pairs of shoes, 110 million footballs or two million sofas, according to the LHCA.
Whereas cattle hides are naturally biodegradable, and may decompose in less than 50 years, Sothmann explains synthetics derived from petrochemicals could take as many as 500 years to break down.
Moreover LHCA suggests the annual percentage of discarded and destroyed cattle hides will likely increase if trends continue in the use of synthetics to produce finished goods in place of real leather.
“As consumers, retailers and brands weigh the versatility, beauty, durability and sustainability of leather compared to its imitations, it’s clear: there’s simply no substitute for real leather,” Sothmann says.