Negotiated cash fed cattle prices ended last week mainly steady on a live basis at mostly $124/cwt. and mostly $1-$2 higher in the beef at mainly $200.
Cattle futures basically gave back gains from the previous session on Monday, likely pressured by nearby Lean Hogs, as well as the mostly steady, rather than higher cash fed cattle prices.
Live Cattle futures closed an average of 30¢ lower (2¢ lower to 87¢ lower in spot Feb).
Feeder Cattle futures closed an average of 99¢ lower (45¢ lower at the back to $1.60 lower toward the front).
Wholesale beef values were firm to higher on moderate to good demand and moderate offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 51¢ higher Monday afternoon at $210.55/cwt. Select was $1.68 higher at $208.23.
Corn futures closed 2¢ to 3¢ higher through Mar ’21 and then mostly 1¢ higher.
Soybean futures closed mostly 3¢ to 6¢ lower
Major U.S. financial indices closed higher Monday, helped along by news that the U.S. will remove China from its list of currency-manipulating countries, buoying optimism for the phase-one trade deal between the two nations, which is scheduled to be signed Wednesday.
The Dow Jones Industrial Average closed 83 points higher. The S&P 500 closed 22 points higher. The NASDAQ was up 95 points.
More crossbreeding by dairy farms—dairy cows bred to beef bulls—may shift fewer calves going into veal production and more back toward beef, according to the Livestock Marketing Information Center (LMIC).
“So far, the crossbreeding trend has been rather short-term and modest; on an annualized basis removing 35,000 to 40,000 head from calf slaughter and adding those animals to feedlots,” say LMIC analysts, in the latest Livestock Monitor. “But it may gain momentum. Currently, the LMIC forecasts record small annual calf slaughter levels by 2022.”
LMIC points to the number of calves being harvested for veal production, compared to that in prior years, given that virtually all veal in the U.S. comes from dairy calves.
For the first 14 weeks of 2019, LMIC analysts explain Federally Inspected (FI) calf slaughter was above the same weeks a year earlier. Year-over-year calf slaughter levels fluctuated over the next 28-weeks and then declined the last 10 weeks.
“Some of that 10-week period of declines was due to fewer dairy cows in the U.S….it would represent only a 2,000 to 3,000 head drop in calf slaughter,” LMIC analysts say.
Although it’s unlikely there will be a wholesale shift by dairy producers to churn out Beef X Dairy crossbred steers, LMIC analysts say, “Some regions of the U.S. could see stronger preferences for this strategy than others. Overall, the amount of interest by dairy producers is mounting, because it pencils out nicely for those with the reproductive management skills to capitalize on higher crossbred calf prices.”