Negotiated cash fed cattle trade ranged from limited on light demand to a standstill through Thursday afternoon, according to the Agricultural Marketing Service. There were too few transactions to trend.
So far this week, live prices are $2-$3 higher in the Southern Plains at $131-$132/cwt., $2 higher at $132 in Nebraska and the western Corn Belt. Dressed prices are $3-$5 higher at $207.
Choice boxed beef cutout value was 38¢ lower Thursday afternoon at $285.14/cwt. Select was 67¢ higher at $267.29.
Live Cattle futures wavered in place Thursday, while a break in the Corn rally helped Feeder Cattle breathe higher.
Live Cattle futures closed narrowly mixed from unchanged to an average of 17¢ lower.
Feeder Cattle futures closed an average of 68¢ higher (42¢ to $1.02 higher).
Corn futures closed mostly 1¢ to 3¢ lower.
Soybean futures closed 2¢ to 8¢ higher through Sep ’22 and then mostly fractionally lower to 1¢ lower.
Major U.S. financial indices closed narrowly mixed Thursday as investors appeared to be digesting direction amid increasing inflation.
The Dow Jones Industrial Average closed 158 points lower. The S&P 500 closed 2 points higher. The NASDAQ was up 81 points.
“After three Congressional hearings featuring the testimony of industry experts and a major economic analysis of the beef supply chain out of Texas A&M, Senators continue to ignore market fundamentals and are attempting to guarantee higher prices for livestock producers,” according to Julie Anna Potts, President and CEO of the North American Meat Institute.
Potts was referring to new bipartisan compromise legislation — the Cattle Market Price Discovery and Transparency Act — announced by U.S. Senator Deb Fischer (R-Neb.) earlier this week.
Among other things, the law would establish regional mandatory minimum thresholds of negotiated cash and negotiated grid trades based on regional average 18-month trade levels.
“If this bill becomes law, there will be cattle producers who want alternative marketing arrangements, but will instead be forced to sell on the cash market, and the industry will turn back time to the days of commodity cattle,” Potts says.
She offers relevant statements made by expert agricultural economists during the aforementioned Congressional hearings.
For instance, in Senate testimony, Glynn Tonsor, agricultural economist at Kansas State University explained, “Stated directly – without contemporary use of alternative marketing agreements I believe cattle prices would be lower as production efforts would not align as well with consumer demands.”
In House testimony, Jayson Lusk, agricultural economist at Purdue noted, “Even if 100 percent of cattle were being sold on the cash market, it doesn’t mean prices would have been any higher than what we recently observed.”