Through Friday afternoon, cash fed cattle was shaping up to be another final-hour affair. The surprising break in futures prices the previous day likely had both packers and feeders trying to assess leverage. Depending on how you slid the beads and who was working the abacus, odds still favored cattle feeders.
According to the Texas Cattle Feeders Association late in the day, members traded steers and heifers for $127/cwt., which was $4 more than the previous week’s country trade.
Cattle futures roared back on Friday, regaining the majority of losses from the previous session. That was ahead of the monthly Cattle on Feed report, which came in with more placements than many analysts expected but far from the double-digit hikes in recent months (see below).
Live Cattle futures closed an average of $1.74 higher ($1.15 to $2.12 higher in spot Feb).
Feeder Cattle futures closed an average of $2.50 higher, except for 60¢ lower in newly minted away Jan.
Choice boxed beef cutout value was 6¢ higher on Friday afternoon at $206.83/cwt. Select was 51¢ higher at $201.83.
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Major U.S. financial indices closed sharply higher on Friday as major companies continued to report earnings that beat estimates.
The Dow Jones Industrial Average closed 223 points higher. The S&P 500 closed 33 points higher. The NASDAQ closed 94 points higher.
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Although year-to-year placements in December were significantly less than in recent months, they were more than the trade was expecting, according to the monthly Cattle on Feed report issued Friday.
Placements in December of 1.79 million head were 0.8% more (14,000 head) than the previous year. Estimates ahead of the report called for about 3% less. In terms of weight, 48.9% went on feed weighing less than 700 lbs.; 10.8% weighing 900 lbs. or more.
Marketings in December of 1.75 million head were 1.4% less (25,000 head) than the previous year, about in line with pre-report estimates.
Cattle on feed in feedlots with one-time capacity of 1,000 head or more was 11.48 million head Jan. 1, which was 8.3% more than the previous year. That was about 0.6% more than estimates ahead of the report. There were 16% more heifers and heifer calves on feed than the previous year.