Despite sharply lower outside markets, a bounce higher in grain prices and the ongoing slower beef packing pace, cash cattle and futures prices held their own last week.
Negotiated cash fed cattle trade was mostly inactive on light demand through Friday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
For the week, live prices were steady to $1 higher in the Texas Panhandle at $137, $1-$2 higher in Kansas at $137. Prices were steady to $1 higher in Nebraska at $137-$138 and $1 lower in the western Corn Belt at $137. Dressed prices were steady at $218.
Cattle futures leaked lower Friday amid stagnant cash prices and bearish outside markets.
Live Cattle futures closed an average of 63¢ lower (25¢ to $1.07 lower), except for unchanged and 5¢ higher in the back two contracts. Week to week, they closed mixed, from an average of 19¢ lower in the front four contracts to an average of 52¢ higher.
Choice Boxed beef cutout value was 57¢ lower Friday afternoon at $292.41/cwt. Select was 15¢ higher at $282.33. Week to week, though, Choice was $8.10 higher and Select was $8.36 higher.
Estimated total cattle slaughter last week was 636,000 head, which was 18,000 head more than the previous week, but 26,000 head fewer than the same week last year. Estimated year-to-date total cattle slaughter of 1.87 million head is 161,000 head fewer (-7.9%) than last year. Estimated year-to-date beef production is 147.5 million lbs. less (-8.6%) at 1.57 billion lbs.
Net U.S. beef export sales were 12,800 metric tons for the week ending Jan. 13, according to the weekly U.S. Export Sales report. Sales were primarily for China, Japan, South Korea, Mexico, and Taiwan.
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Based on weekly auctions monitored by Cattle Current, calf and feeder cattle prices trended widely mixed last week. Impaired travel conditions due to winter weather and wobbly futures prices applied pressure, while the optimistic outlook ahead provided lift, especially for grass-suited cattle.
Feeder Cattle futures closed an average of 90¢ lower (52¢ to $1.65 lower). Week to week, they closed an average of $1.82 lower through the front five contracts and then unchanged to $1 higher.
Although soybean futures closed lower Friday, on likely profit taking, South American weather and geopolitical tensions continue to provide lift.
Soybean futures closed mostly 6¢ to 11¢ lower except for fractionally higher in a few contracts. Week to week on Friday, however, they closed an average of 35.4¢ higher.
Corn futures closed 2¢ to 5¢ higher through Jly ’23 and then fractionally higher. They closed an average of 12.5¢ higher through the front six contracts week to week on Friday.
Exports continued to add lift to grain prices, according to the weekly U.S. Export Sales report. For the week ending Jan. 13.
Net U.S. wheat export sales 44% more than the previous week and 62% more than the prior four-week average. Net U.S. corn export sales were up noticeably from the previous week and up 48% from the prior four-week average. And, Net U.S. export soybean sales were 9% less than the previous week, but 12% more than the prior four-week average.
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Major U.S. financial indices closed sharply lower Friday, led by tech stocks, with continued pressure from treasury bond yields, inflation and pending monetary tightening.
The Dow Jones Industrial Average closed 450 points lower. The S&P 500 closed 84 points lower. The NASDAQ was down 385 points.
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Markets will likely view the latest monthly Cattle on Feed report negatively, with placements significantly higher than average expectations.
Feedlots with 1,000 head or more capacity placed 1.96 million head in December, which was 110,000 head more (+6.0%) than a year earlier. Average expectations were for an increase of 2.5%. Placements were the highest for the month since the series began in 1996.
In terms of placement weights, 50% went on feed weighing less than 700 lbs. (26% less than 600 lbs.), 40% weighing 700-899 lbs. and 10% weighing 900 lbs. or more.
Marketings in December of 1.86 million head were 4,000 head more (+0.21%) than the previous year, which was in line with pre-report expectations.
Cattle on feed Jan. 1 of 12.04 million head were 70,000 head more (+0.58%) more than a year earlier and the second highest for the date since the series began in 1996. Heifers and heifer calves on feed (4.68 million head) were 2% more year over year.