Negotiated cash fed cattle trade was steady with the previous week in the Southern Plains at $124/cwt. through Wednesday afternoon, according to the Agricultural Marketing Service. Trade was limited on light demand in the Texas Panhandle; slow on moderate demand in Kansas.
Trade in other regions was slow on light demand.
Live sales in Nebraska were steady to $2 higher at $124; steady in the beef at $196. Although too few to trend, there were some early live sales in the western Corn Belt at $123-$124, and a few in the beef at $196. Price there last were $122 and $193-$196, respectively.
Cattle futures closed lower Wednesday. Along with lower outside markets early in the day, most pressure seemed tied to WASDE increasing expected beef production for this year, as wholesale beef prices decline and cash fed cattle prices remain tough to budge.
Feeder Cattle futures closed an average of 85¢ lower (22¢ to $1.32 lower).
Live Cattle futures closed an average of 71¢ lower (25¢ lower at the front to $1.15 lower.
Choice boxed beef cutout value was $1.05 lower Wednesday afternoon at $280.02/cwt. Select was $2.65 lower at $258.70.
Corn futures closed mostly 6¢ to 10¢ lower.
Soybean futures closed mostly 4¢ to 7¢ lower.
Major U.S. financial indices closed mixed Wednesday. News was mixed, too
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4% in
September on a seasonally adjusted basis after rising 0.3% in August, according to the U.S. Bureau of Labor Statistics. Leave food and energy out, and the month-to-month increase was 0.2%. The all-items index increased 5.4% over the last 12 months, before seasonal adjustment.
Minutes from the Federal Reserve meeting in September suggest stimulus tapering as soon as next month, which was expected.
The Dow Jones Industrial Average closed fractionally lower. The S&P 500 closed 13 points higher. The NASDAQ was up 105 points.
Pent-up demand provided a tailwind for the meat industry in recent months, but the full effect of inflation is expected to test consumers’ appetite for meat during the fourth quarter, according to analysts with CoBank’s Knowledge Exchange Division (CKE).
Pandemic-disrupted supply chains have plenty to do with recent inflationary price pressure.
According to a new CKE Quarterly report, supply chains are arguably in the most dire condition since the start of the pandemic, as lead times for manufacturing inputs recently reached record highs. Persistent supply chain disruptions and labor shortages are adding significant costs to business operations, and consumers will feel these effects through higher prices for months to come.
“Supply chain snarls are likely to persist well into 2022, and so will elevated inflation,” says Dan Kowalski, CKE vice president. “The latest producer price index data for August was up 20% year-over-year, while the consumer price index increased just 5.2%. So it’s clear that many businesses are passing only a small portion of those cost increases on to the final consumer. We expect that will change in the months ahead and many businesses will raise prices.”
Rapidly rising input costs and product shortages are hitting agriculture particularly hard, as agricultural commodity prices have flattened and inflation compresses margins, according to the CKE report. However, CKE analysts say robust exports have kept much of agriculture in the black.