Cattle futures closed lower Friday after early support, likely pressured by softer cash fed cattle prices, weaker Choice wholesale beef values and perhaps some positioning ahead of the monthly Cattle on Feed report (see below).
Live cattle futures closed an average of $1.38 lower. Feeder Cattle futures closed an average of $1.51 lower. Week to week on Friday, Live Cattle futures closed an average of $2.00 lower and Feeder Cattle futures closed an average of $3.91 lower.
Negotiated cash fed cattle trade was mostly inactive on moderate demand in all major cattle feeding regions through Friday afternoon, according to the Agricultural Marketing Service.
Although too few to trend, there were some early FOB live trades in the Texas Panhandle at $228/cwt. Prices in the Southern Plains the previous week were $235.
For the week, FOB live prices were $4-$6 lower in Nebraska at $236/cwt. and $3-$4 lower in the western Corn Belt at $236-$238. Dressed delivered prices were $4 lower at $376.
Choice boxed beef cutout value was $4.92 lower Friday afternoon at $390.50. Select was $2.36 higher at $376.95.
Estimated total cattle slaughter last week of 554,000 head was 4,000 head fewer than the previous week and 62,000 head fewer than the same week last year. Year-to-date estimated total cattle slaughter of 14 million head was 955,000 fewer (-6.4%) than the same time last year. Year-to-date estimated beef production of 12.2 billion pounds was 398.2 million pounds less (-3.2%).
Turning to grains, futures were lower Friday with likely profit taking and favorable precipitation and weather.
Corn futures closed 2¢ to 4¢ lower. Kansas City Wheat futures closed mostly 5¢ to 8¢ lower. Soybean futures closed mostly 4¢ to 7¢ lower.
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Major U.S. financial indices were narrowly mixed Friday with pressure from tech stocks and tensions surrounding the Israel-Iran conflict.
The Dow Jones Industrial Average closed 35 points higher. The S&P 500 closed 13 points lower. The NASDAQ was down 98 points.
West Texas Intermediate Crude Oil futures (CME) closed mixed through the front six contracts, from 21¢ lower to 34¢ higher.
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Markets will likely view Friday’s monthly Cattle on Feed report as neutral to supportive with fewer placements than expected.
Feedlots with 1,000 head or more capacity placed 1.9 million head in May, which was 160,000 head fewer than the previous year (-7.8%) and 2% less than average pre-report estimates.
In terms of placement weights, 33% went on feed weighing 699 pounds or less, 51% weighing 700-899 pounds and 16% weighing 900 pounds or more.
Feedlots marketed 1.8 million head in May, which was 197,000 head fewer (-10.1%) than the previous year, which was in line with estimates ahead of the report.
Likewise, cattle on feed June 1 were as expected with 11.4 million head, which was 112,000 head fewer (-1%) than the same time last year.