Cattle futures strengthened Monday, helped along by positive outside markets and the monthly Cattle on Feed report (see below), which indicated fewer placements than expected last month.
Before settlement, Live Cattle futures were an average of $1.05 higher. Feeder Cattle futures were an average of 54¢ higher, well off session highs, capped by advancing Corn futures.
Negotiated cash fed cattle trade was at a standstill in all major cattle feeding regions through Monday afternoon, according to the Agricultural Marketing Service.
Last week, live FOB prices were steady to 50¢ higher in the Texas Panhandle at $188-$188.50/cwt. steady to $1 lower in Kansas at $187-$188 and $2 lower in the North at $196. Dressed delivered trades were $2 lower at $310/cwt.
The weighted average five-area direct FOB live steer price last week was 57¢ lower at $193.67. The weighted average dressed delivered steer price was $2.56 lower at $310.04.
Choice boxed beef cutout value (p.m.): 39¢ lower at $313.44/cwt. Select was 47¢ lower at $298.33/cwt.
Soybeans led the grain complex higher Monday with short covering and apparent weather premium based on the global outlook.
Heading into the close, through Jly ’25 contracts, Soybean futures were 21¢ to 33¢ higher. Corn futures were 10¢ to 11¢ higher. Kansas City Wheat futures were 1¢ to 2¢ higher.
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Major U.S. financial indices rebounded Monday, as investors bought back tech stocks.
The Dow Jones Industrial Average closed 127 points higher. The S&P 500 closed 59 points higher. The NASDAQ was up 280 points.
Heading into the close, West Texas Intermediate Crude Oil futures on the CME were 4¢ to 25¢ lowermthrough the front six contracts.
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Derrell Peel, Extension livestock marketing specialist at Oklahoma State University provides further perspective to the recent monthly Cattle on Feed report in his weekly market comments.
“Although the feedlot inventory has been slow to decrease, feedlots have been placing fewer cattle as feeder supplies have dwindled in recent years,” Peel says. “The total U.S. calf crop peaked in 2018 in the most recent cattle cycle and has been declining each of the past five years. The 2024 calf crop is estimated to be another 1.5% smaller year over year leading to a total decline since 2018 of 8.9% or 3.2 million head.”
While marketings in June were 8.7% less year over year, Peel explains average daily marketing were slightly higher when accounting for two less business days this year than last.
Peel also points out the percentage of heifers in the on-feed mix July 1 was near the highest level in the past 20 years at 40%.
“The heifer percentage of feedlot inventories drops below the average level (36.7%) during periods of heifer retention and herd rebuilding and is above average during periods of herd liquidation,” Peel explains.