Negotiated cash fed cattle trade ended the week with live prices $3 higher at $110/cwt. in Nebraska and the Southern Plains; $3-$4 higher in the western Corn Belt at $108-$110, according to USDA’s Agricultural Marketing Service (AMS). Dressed prices were at $172, which was $4 higher in Nebraska and $5-$8 higher in the western Corn Belt. Although prices were higher, some thought the market was poised to reap steeper gains.
Through Thursday, the five-area direct weighted negotiated fed steer price was $109.46/cwt. on a live basis, which was $3.11 more than the previous week but $5.69 less than the same week in 2019. The average steer price in the beef was $171.88, which was $6.58 more week to week but $10.07 less year over year.
Cattle futures closed sharply lower Friday, with much of the pressure seemingly tied to overbought conditions, week-end positioning and fears that escalating COVID-19 cases will take another whack at packer production.
Live Cattle futures closed an average of $1.61 lower, from $1.10 lower toward the back to $2.57 lower toward the front.
Feeder Cattle futures closed an average of $2.38 lower.
Choice boxed beef cutout value was 52¢ lower Friday afternoon at $225.98/cwt. Select was $1.22 higher at $209.46.
Corn futures closed mostly 1¢ to 2¢ higher.
Soybean futures closed mostly 4¢ to 9¢ higher through Nov ‘22 and then mostly unchanged.
U.S. financial indices closed higher Friday, as investors seemed less worried about the surge in COVID-19 cases and more comfortable that the recently announced vaccine will enable the nation to get back to business, ultimately.
The Dow Jones Industrial Average closed 399 points higher. The S&P 500 closed 48 points higher. The NASDAQ was up 119 points.
“Agriculture will need to speak up with the new administration on its priorities, and we need to strengthen the bipartisan nature of American agriculture,” explained former assistant U.S. trade representative Sharon Bomer Lauritsen at last week’s virtual U.S. Meat Export Federation (USMEF) Strategic Planning Conference.
“There has never been a more important time to maintain a strong and unified agriculture and agribusiness voice at the state level, and in Washington, D.C., to balance the industrial voices,” Bomer Lauritsen said. “U.S. agriculture will need to defend and advance its interests, make sure they are heard over the non-ag voices, and keep the rules of trade strong and enforced to ensure that American agricultural exports continue to thrive.”
Bomer Lauritsen, who recently retired from the U.S. government after 29 years of service and is now a trade policy consultant at Ag Trade Strategies, LLC, recapped many key trade breakthroughs for U.S. red meat over the years. She noted that while the Trump administration’s approach to tariffs and trade sometimes put agricultural exports in a negative position, it also helped bring key trading partners such as Japan and China to the negotiating table on longstanding market access obstacles for U.S. beef and pork. She also offered a preview of what to expect from a new administration.
“President-elect Biden has stated his priority will be fixing domestic issues first, but that doesn’t mean that the new administration at lower levels can’t lay the groundwork to build constructive relationships and a foundation for trade negotiation,” she said. “Biden also hasn’t rejected engaging on the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), but has stated the U.S. would need to see changes. I think it’s possible to move forward with a Japan negotiation, although automotive issues will be difficult and could have ramifications for agriculture.”
Further, Pat Binger, new USMEF chair, explained that despite facing trade barriers and an uncertain economic climate in many key regions of the world, there are excellent prospects to further expansion of U.S. red meat’s global footprint.
“From a carcass utilization standpoint, we need to continue to find ways to expand our export product mix—that’s a big opportunity going forward,” Binger said. “Additionally, there are items today that our industry is not getting boxed, either due to lack of labor or a combination of labor and complexity, and that’s another opportunity that we need to manage through. But all in all, I am very optimistic about the U.S. red meat industry’s ability to take on challenges and seize the opportunities that lie ahead. I remain excited and highly encouraged about the future of our industry.”