Cattle futures bounced back Tuesday, supported by resurgent wholesale beef values.
Toward the close and ahead of settlement, Live Cattle futures were an average of $1.06 higher. Feeder Cattle futures were an average of $1.60 higher.
Negotiated cash fed cattle trade was at a standstill in all major cattle feeding regions through Tuesday afternoon, according to the Agricultural Marketing Service.
Last week, FOB live prices were $184/cwt. in the Southern Plains $186-$187 in Nebraska and $185-$187 in the western Corn Belt. Dressed delivered prices were $294-$295.
Wholesale beef prices continued to firm, offering hopes that the seasonal rally has begun.
Choice boxed beef cutout value was 27¢ lower Tuesday afternoon at $298.49/cwt. Select was $2.59 higher at $292.34/cwt.
Grain futures softened Tuesday amid likely producer selling. Heading into the close, Corn futures were narrowly mixed from fractionally lower to 3¢ lower in the front three contracts and then fractionally higher to 1¢ higher through Dec ‘25. Kansas City Wheat futures were 7¢ to 15¢ lower through May ‘25. However, Soybean were mostly 3¢ to 7¢ higher through Jly ‘25.
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Major U.S. financial indices closed narrowly mixed Tuesday.
The Dow Jones Industrial Average closed 31 points higher. The S&P 500 closed 6 points higher, but the NASDAQ was down 16 points.
Heading into the close West Texas Intermediate Crude Oil futures on the CME were 10¢ to 13¢ lower through the front six contracts.
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Increased slaughter levels and heavier dressed weights are boosting domestic beef production, but so is trade, says David Anderson, livestock economist with Texas A&M AgriLife Extension Service.
“Beef imports in the first quarter of the year totaled 1.2 billion pounds, 25% more than last year. Exports were 6% less, or 46 million pounds, lower than last year,” Anderson explains, in the most recent issue of In the Cattle Markets. “Combining the increase in imports and decrease in exports means that about an additional 285 million pounds of beef were added to total beef supplies in the first quarter. That’s about 0.86 pounds of beef, per capita.”
Increased beef production has likely contributed to wholesale beef price struggles, according to Anderson.
“Only the Choice chuck and round are above a year ago. The rib and loin are below a year ago, and their weakness might suggest other problems beyond just larger supplies, especially getting close to Memorial Day,” Anderson explains. “On the positive side, this increase in beef production will be temporary. Reduced placements will begin to move the number of cattle on feed lower. If weights continue to be larger than a year ago the total number of cattle processed will decline further.”