Cash fed cattle prices continued to tick lower on Wednesday at $115/cwt. in the Southern Plains, which was $7 less than last week. The same price and week-to-week decline defined trade in Nebraska a day earlier.
There were 2,586 head offered in the weekly Fed Cattle Exchange auction, but no takers.
Cattle futures continued lower, perhaps partly due to technical positioning, but there was at least a sense of trying to find some stable ground.
Other than 47¢ and 15¢ lower in the back two contracts, Live Cattle futures closed an average of 91¢ lower.
Feeder Cattle futures closed an average of $1.07 lower (45¢ to $1.72 lower).
Choice boxed beef cutout value was 61¢ lower Wednesday afternoon at $231.03/cwt. Select was $1.01 lower at $208.50. Select and Choice rib cuts sold steady to firm, while chuck, round, and loin cuts traded steady to weak, according to the Agricultural Marketing Service. Beef trimmings traded mostly sharply lower on light demand and heavy offerings.
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Major U.S. financial indices closed higher on Wednesday, regaining some of the ground lost the previous day. Support included a bounce in retailer stocks, led by stronger than expected quarterly earnings from Macy’s, according to various analysts.
The Dow Jones Industrial Average closed 62 points higher. The S&P 500 closed 11 points higher. The NASDAQ closed 46 points higher.
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“Firm demand and a moderate marketing pace will likely support fed steer prices in the second quarter to average $116-$120/cwt…However, fed cattle prices will likely edge lower in the second half of the year as the supply of fed cattle increases and carcass weights make their seasonal rebound,” say analysts with USDA’s Economic Research Service (ERS), in the monthly Livestock, Dairy and Poultry Outlook.
From March to April, steer carcass weights declined 17 lbs. to 861 lbs., but were still 12 lbs. heavier than the previous year, according to ERS. Heifer carcass weights declined 22 lbs. to 798 lbs., but were 7 lbs. more than the previous year.
“It should be noted that the large drop in carcass weights vis-à-vis March reflects, in part, a seasonal shift toward a greater proportion of cattle weighing under 600 lbs. placed in feedlots in fourth-quarter 2017,” ERS analysts say. “Cattle placed at lighter weights are likely marketed at lighter weights.”
The folks at ERS expect the annual fed steer price (5-area direct) this year to average $114-$119/cwt. They forecast next year’s annual fed steer prices to average $113-$122./cwt.
Annual feeder steer prices for this year are forecast to average $138-$144; $135-$147 next year.