Feeder Cattle futures closed an average of 35¢ higher, except for 80¢ and 72¢ lower at either end of the board, supported by continued erosion in Corn futures.
Live Cattle futures closed an average of 25¢ lower, awaiting cash direction.
Wheat futures closed mostly 1¢ to 4¢ lower Tuesday with likely profit taking.
Corn futures closed 9¢ to 11¢ lower through Jly ‘24, and then mostly 7¢ lower.
Soybean futures closed mostly 19¢ to 36¢ lower.
Negotiated cash fed cattle trade was at a standstill in all regions through Tuesday afternoon, according to the Agricultural Marketing Service.
Last week, live prices were $170/cwt. in the Southern Plains, mostly $176 in Nebraska and $175-$177 in the western Corn Belt. Dressed prices were $280.
Choice boxed beef cutout value was $2.51 lower Tuesday afternoon at $299.47/cwt. Select was 36¢ lower at $284.35/cwt.
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Major U.S. financial indices closed lower amid heightened recession fears, fueled by weaker retail sales than anticipated and a lower annual financial forecast from bellwether, Home Depot.
The Dow Jones Industrial Average closed 336 points lower. The S&P 500 closed 26 points lower. The NASDAQ was down 22 points.
West Texas Intermediate Crude Oil futures (CME) closed 25¢ lower through the front six contracts.
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Left to their own devices, markets rise and fall, discount and reward and find their way to economic truths, whether or not anyone likes the ride or the destination.
A recent editorial by the Wall Street Journal (WSJ) Editorial Board, and shared by the North American Meat Institute, provides a reminder.
Authors note Tyson Foods last week reported its first quarterly loss since 2009 as meat prices declined.
“Tyson’s stock plunged after it reported anemic sales and downgraded its forecast. The quarterly loss at the largest U.S. meat supplier marks a stunning reversal from 2021 and early last year when it earned record profits amid a run-up in meat prices,” write WSJ authors.
Back then, they also note lawmakers accused beef packers of conspiring to manipulate the market to pad profits.
“Are they now conspiring to lose money?” wonder the authors. “…If markets were ‘distorted,’ the culprit was pandemic transfer payments that were a disincentive to work. As these programs lapsed, hiring became easier. Competition for workers and market share raised supplier costs while pushing down prices and profits. Meat prices fell 0.4% in April and are up only 0.3% over the past 12 months…
“Tyson’s stock has fallen by nearly half over the past year and is trading at the lowest levels since 2015. This doesn’t look like an antitrust conspiracy or market oligopoly…”