Negotiated cash fed cattle trade was at a standstill in the Southern Plains through Friday afternoon. Elsewhere, it was limited on light demand with too few transactions to trend, according to the Agricultural Marketing Service (AMS).
For the week, live prices were $1-$2 higher at $115/cwt. in the Southern Plains and $116 in the Northern Plains. Dressed trade was $2-$3 higher in Nebraska at $185. Trade was yet to be established in the western Corn Belt, according to AMS, but various reports suggested trade in the region at as much as $3 higher than the previous week.
Cattle futures continued to edge higher Friday, buoyed by the week’s stronger cash prices and wholesale beef values.
Live Cattle futures closed an average of 36¢ higher, except for 20¢ lower in the back contract.
Feeder Cattle futures closed an average of 39¢ higher, from 15¢ higher toward the back to 90¢ higher in spot Apr.
Choice boxed beef value was $1.21 higher Friday afternoon at $237.66/cwt. Select was $1.52 higher at $227.77.
Estimated total cattle slaughter the week ending Mar. 26 was 646,000 head, according to USDA. That was 19,000 head more than the previous week, but 39,000 head fewer (-5.69%) than the same week a year earlier. Estimated total year-to-date cattle slaughter of 7.75 million head was 278,000 head fewer (-3.46%) than the same time last year. Estimated year-to-date beef production of 6.50 billion lbs. was 143.1 million lbs. less (-2.15%).
Corn futures closed mostly 1¢ higher, except for 3¢ and 6¢ higher at either end of the board.
Soybean futures closed 6¢ to 13¢ lower through the front six contracts, and then mostly 2¢ higher.
Major U.S. financial indices closed sharply higher Friday with a late-session surge tied to the Federal Reserve announcement that banks meeting stress criteria can return to normal levels of dividend disbursement and share repurchases at the end of June. That ability was limited since the beginning of the pandemic.
Investors were likely also encouraged by the latest data from the U.S. Bureau of Economic Analysis, suggesting tame inflation. It showed the personal consumption expenditure price index, excluding food and energy prices, increased just 0.1% month to month in February and just 1.4% year over year.
The Dow Jones Industrial Average closed 453 points higher. The S&P 500 closed 65 points higher. The NASDAQ was up 161 points.
“There was a time in the beef industry when $200/cwt. was the primary resistance point for the weekly Choice boxed beef cutout value. However, the $200 level appears to be the primary support point in that the weekly Choice boxed beef price has not been below this level since the week ending Oct. 20, 2017,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments.
Griffith says Choice boxed beef cutout values exceeded $200 for the first time in May 2013 (looking back as far as 2004). Between May 2013 and October 2017, he explains the Choice prices swung to levels on either side of $200 but exceeded the level since then.
“Choice beef prices have been strong the first quarter of 2021 and they are only expected to get stronger in the second quarter as grilling season hits full stride,” Griffith says. “Many consumers have ample disposable income because they have not been traveling. Thus, they can spend some of that money on their eating experience. There is no reason to attempt to predict how high boxed beef prices will go this spring, but they are likely to test the $250 mark.”