Negotiated cash fed cattle trade was undeveloped through Tuesday afternoon. Last week’s stronger cash trade and another winter storm looming for the Plains and Midwest later this week suggest steady to higher prices.
Those factors supported nearby Live Cattle futures, while lower grain prices boosted Feeder Cattle.
After $1.52 higher in spot Feb, Live Cattle futures closed narrowly mixed (an average of 36¢ lower to an average of 36¢ higher).
Except for 10¢ lower in spot Jan, Feeder Cattle futures closed an average of 45¢ higher.
Grain pressure on Tuesday included, reportedly, more promising weather in South America and the dearth of public data.
Corn futures closed 5¢ to 7¢ lower through Jul ’20 and then mostly 2¢ lower.
Soybean futures closed 9¢ to 10¢ lower through Mar ‘20 and then mostly 4¢ to 7¢ lower.
Wholesale beef values were steady to firm on moderate to fairly good demand and heavy offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 19¢ higher Tuesday afternoon at $212.21/cwt. Select was 41¢ higher at $205.87.
Major U.S. financial indices closed higher Tuesday, led by tech stocks and supported by early quarterly earnings that were mostly stronger than expected.
The Dow Jones Industrial Average closed 155 points higher. The S&P 500 closed 27 points higher. The NASDAQ was up 117 points.
“Recent weather may delay fed cattle marketing enough to help support fed cattle prices or push prices higher,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “Whether or not weather impacts are widespread enough to noticeably impact overall market conditions, cattle producers in many areas face significant management headaches due to the weather.”
Peel says the weekend storm dealt heavy snow to some cattle feeding regions in eastern Colorado, Kansas, southeastern Nebraska, southern Iowa and the eastern Corn Belt.
“Feedlots typically post the lowest seasonal average daily gains (ADG) for cattle marketed in March to May, which reflects cattle fed over the previous four to six months. This likely includes the negative impacts of winter weather on feedlot performance but also partly reflects the fact that feedlots place the highest proportion of lightweight cattle (which have lower ADG) in the fall and feed them through the winter,” Peel explains. “Feedlots also experience poorer feeding efficiency in the winter with the highest feed-to-gain ratios of the year posted for cattle marketed in February and March. This occurs despite the fact that lightweight cattle placed in the fall have lower feed-to-gain ratios relative to heavier feedlot placements. This again indicates the impact of winter weather on cattle feeding. Not surprisingly, feedlots post the highest animal morbidity and mortality rates for cattle fed through the winter.”