Cash fed cattle prices opened the week’s trade lower on Wednesday.
The weighted average price at the weekly Fed Cattle Exchange Auction was $117.75/cwt. on 92 head for 1-9 day delivery compared to $119.51 a week earlier. Another 337 head sold for delivery $117.25 (delivery 17-30 days). About 20% sold of the 2,093 head offered.
Country trade followed suit with early sales in Nebraska $1 less than the bulk of the previous week’s trade at $117.
Live Cattle futures closed an average of $1.72 lower ($1.35 to $2.20 lower).
Feeder Cattle futures closed an average of $3.05 lower ($1.47 to $3.87 lower).
Choice boxed beef cutout value was 31¢ lower Wednesday afternoon at $222.58/cwt. Select was $2.13 lower at $205.32.
Major financial indices closed mostly little changed on Wednesday. Although tech stocks rebounded, oil prices moved lower following the hint of a rally in recent days.
The Dow Jones Industrial Average closed 1 point lower. The S&P 500 closed 3 points higher. The NASDAQ closed 40 points higher.
“Following relatively tight supplies fueled by a rapid pace of slaughter earlier in the year and fed cattle weights well below a year ago, supplies are starting to increase, seasonally,” says David Anderson, Extension livestock economist with Texas A&M University. “Steer slaughter remains slightly above last year’s pace, while heifer slaughter in recent weeks has run close to 10% above last year. Dressed weights are also increasing, as they usually do this time of year. Steer dressed weights have increased 23 lbs. since they bottomed at 832 lbs.”
Cow slaughter is also running higher year over year, especially since the end of May, according to Anderson, in the latest issue of In the Cattle Markets.
“The weeks following Memorial Day saw a dramatic increase in beef cow slaughter, up about 10,000 head per week, almost 20% more than the same weeks in 2016,” Anderson explains. “For the year, beef cow slaughter is up about 9.8% over last year. About 62% of the increase in total beef cow slaughter is in the Southern Plains region, including Texas and Oklahoma. While cull cow prices in the Southern Plains have increased slightly over the past month, the cow beef cutout and 90%-lean wholesale beef price have increased sharply. The boxed cow-beef cutout hit $180/cwt. last week, up steadily from $158 at the beginning of the year. This cutout increased $8 over the last month. Wholesale boneless beef, 90% lean hit $229 the last week of June, up from $218 the same week last year. The strength in lean boneless beef is indicative of relatively tight supplies of lean beef for ground beef and apparently good interest in hamburgers from consumers.”