Choice wholesale beef value bounced higher Thursday with moderate to fairly good demand and moderate to heavy offerings, according to the Agricultural Marketing Service. Choice boxed beef cutout value was $1.65 higher Thursday afternoon at $232.68/cwt., the highest level since last June. Select was 26¢ lower at $208.24. Select and Choice chuck, round, and loin cuts sold steady to firm. Rib cuts traded higher for Choice and weaker for Select. Beef trimmings sold mostly moderately lower on light demand and heavy offerings. At $24.44, the Choice-Select spread was also the widest since last June.
The firmer beef values helped Cattle futures come up for air on Thursday, along with apparent short covering.
Other than unchanged in Oct and 25¢ lower in the back contract, Live Cattle futures closed an average of 65¢ higher (5¢ to $1.22 higher in spot Jun).
Feeder Cattle futures closed an average of $1.28 higher (37¢ to $2.00 higher).
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Major U.S. financial indices closed lower on Thursday, giving back some of the previous session’s gains. Pressures included rising interest rates and negative rhetoric from the White House regarding trade talks with China.
The Dow Jones Industrial Average closed 54 points lower. The S&P 500 closed 2 points lower. The NASDAQ closed 15 points lower.
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“Greater U.S. production and continued strength in demand from Asian markets are expected to boost beef exports to a consecutive record high in 2019,” say analysts with USDA’s Economic Research Service (ERS), in the monthly Livestock, Dairy and Poultry Outlook.
Specifically, ERS forecasts a 3.8% year-over-year increase next year to 3.150 billion lbs.
Overall, ERS expects strong domestic and international demand for U.S. beef to support slightly higher fed cattle prices next year.