Cattle Current Daily—Jan.9, 2024

Cattle Current Daily—Jan.9, 2024

Cattle futures moved higher early in the day, supported by last week’s stronger cash fed cattle prices, looming performance-depressing weather and some thoughts that the bottom is in or near for Choice wholesale beef values. By the end, Feeder Cattle closed mostly higher with help from lower Corn futures, while Live Cattle finished lower, perhaps with technical pressure tied to the broader commodity sell-off.

Feeder Cattle futures closed an average of 48¢ higher, except for an average of 21¢ lower in two contracts.

Live Cattle futures closed an average of 51¢ lower.

Negotiated cash fed cattle trade was at a standstill in all regions through Monday afternoon, according to the Agricultural Marketing Service.

Last week, FOB live prices were steady to $1 higher in the Southern Plains at $172-$173/cwt., $3 higher in Nebraska at $173-$175/cwt. and $3 higher in the western Corn Belt at $175. Dressed delivered prices were generally $1-$2 higher at $274-$275.50.

The weighted average five-area direct fed steer price last week was $1.77 higher at $174.01/cwt. The weighted average dressed steer price was $1.91 higher at $274.78.

Choice boxed beef cutout value was $1.67 higher Monday afternoon at 278.83/cwt. Select was 17¢ lower at $259.36/cwt.

Turning to row crops, rains in South America continued to pressure Soybean futures Monday, helping lead grain futures lower.

Soybean futures closed 8¢ to 10¢ lower through Jly ’24 and then mostly 3¢ to 6¢ lower.

Corn futures closed mostly 4¢ to 5¢ lower through Jly ’25 and then mostly 2¢ lower.

KC HRW Wheat futures closed 9¢ to 14¢ lower.

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Major U.S. financial indices bounced higher Monday, led by tech stocks.

The Dow Jones Industrial Average closed 216 points higher. The S&P 500 closed 66 points higher. The NASDAQ was up 319 points.

West Texas Intermediate Crude Oil futures (CME) closed $2.54 to $3.04 lower through the front six contracts, with chatter about Saudi Arabia selling at lower prices outside of OPEC.

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The semiannual USDA Cattle report, scheduled for release Jan. 31, will provide quantification of how much the beef cow herd contracted last year but will be unable to say anything about rebuilding plans this year.

“Beef cow herd liquidation will likely slow, perhaps stop in 2024; though there is little chance of any significant rebuild for a year or more. It will, of course, depend on weather and forage conditions in the coming year,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “The heifer retention needed to rebuild the herd will squeeze feeder supplies, feedlot production, cattle slaughter and beef production going forward. However, it is unclear how aggressive that process will be.”

Although production costs are easing, and drought conditions have improved in many regions, Peel points out producers in these regions need time for forage recovery, and in some cases, water recovery. At the same time, drought continues for some.

“With considerable uncertainty remaining about moisture and forage conditions for the coming growing season, many producers are logically taking a very cautious approach to animal stocking,” Peel says.

2024-01-08T20:47:03-06:00

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