Cattle Current Daily—June 29, 2021

Cattle Current Daily—June 29, 2021

Negotiated cash fed cattle trade was at a standstill in the Texas Panhandle through Monday afternoon, according to the Agricultural Marketing Service. The latest reported market in the Southern Plains was two weeks ago with live sales at $122/cwt.

Trading was slow on light demand in Nebraska with early live sales steady to $1.50 higher at $126.50/cwt. Last week in Nebraska, dressed sales traded at $197/cwt.

Trading in the Western Corn Belt and Kansas was mostly inactive on very light demand. Last week in the Western Corn Belt, live sales traded from $125-$126/cwt. and dressed sales traded at $197/cwt.

A surge in Corn futures pressured feeder cattle futures on Monday, while live cattle futures traded narrowly mixed.

Live Cattle futures closed mixed from an average of 78¢ lower through the front four contracts to an average of 9¢ higher except for the back contract, unchanged.

Feeder Cattle futures closed down across the board an average of $1.73 lower, from $3.20 lower at the front to $1 lower at the back.

Choice boxed beef cutout value was $7.13 lower at $297.43/cwt. Select was $2.22 lower at $273.96.

Grain futures closed rallied back on Monday as weekend weather conditions deteriorated.

Corn futures closed mostly 17¢ to 39¢ higher through Dec ’22.

Soybean futures closed mostly 36¢ to 42¢ higher through Sept ’22.

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Major U.S. financial indices closed mixed to start the week, with tech companies rallying on news that Facebook won dismissal of two monopoly lawsuits. Economic news to come out this week include a jobs report on Friday.

The Dow Jones Industrial Average closed 151 points lower. The S&P 500 closed 10 points higher. The NASDAQ closed up 140 points.

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Cattle feeders have yet to turn the corner toward reduced average feedlot inventories, but Derrell Peel says it’s getting closer.

Peel, Extension livestock marketing specialist at Oklahoma State University explains in his weekly market comment that feedlot inventories declined by 3.4% from February to June of this year, the largest decrease for that period since 2012. He notes the average change in feedlot inventories from February to June in the five years from 2016-2020 was an increase of 0.3%.

At the same time, Peel points out the 12-month moving average feedlot inventory has been record large since March.

“The current fed cattle market will show improvement faster than the moving average (figure below), which takes time to reflect changing conditions, and that appears to be happening,” Peel says. “Cash fed cattle prices last week averaged $122/cwt., the highest level in eight weeks. Barring some new disruption, feedlot inventories should drop below 2020 (and 2019) levels in the next month or two and remain there going forward. However, the ongoing drought could represent such a disruption if dry conditions force feeder cattle into feedlots sooner than usual. Drought could slow down the process of tightening beef supplies in 2021 but increased cowherd liquidation would lead to even smaller supplies in the coming years.”

2021-06-28T20:50:55-05:00

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