Negotiated cash fed cattle trade ranged from inactive on light demand to mostly inactive on light demand through Thursday afternoon, according to the Agricultural Marketing Service.
So far this week, live prices are steady in the Southern Plains at $124/cwt., steady to $2.50 higher in Nebraska at $124.00-$126.50 and steady to $1 higher in the western Corn Belt at $124-$125. Dressed prices are steady at $196.
Cattle futures closed mixed Thursday.
Live cattle were down an average of 63¢ lower on likely profit taking, pressure from Lean Hogs and positioning ahead of Friday’s Cattle on Feed report. Feeder Cattle managed to close narrowly mixed.
Feeder Cattle futures closed narrowly mixed, from an average of 36¢ lower to an average of 19¢ higher.
Choice boxed beef cutout value was 63¢ higher at $280.66/cwt. Select was 8¢ lower at $262.72/cwt.
As for grains, Corn and soybean futures closed lower Thursday beneath the weight of profit taking and lower crude oil prices.
Corn futures closed mostly 4¢ to 7¢ lower.
Soybean futures closed mostly 18¢ to 21¢ lower.
Major U.S. financial indices closed mainly higher Thursday. Support included fewer weekly jobless claims than the trade expected. Initial weekly unemployment claims for the week ending Oct. 16 was 290,000, according to the U.S. Department of Labor. That was 6,000 fewer than the previous week and the lowest level since March 14 last year.
The Dow Jones Industrial Average closed 6 points lower. The S&P 500 closed 13 points higher. The NASDAQ was up 94 points.
Slaughter data continues to suggest beef cow herd liquidation.
“The cow herd is in contraction mode this year as the drought and tough economical factors have made ranchers think of ways to keep the cow herd together,” according to analysts with the Agricultural Marketing Service. “Preliminary data from NASS puts the beef cow slaughter rate at around 9% more than a year ago and near 20% more than the previous five-year average. Heifer slaughter is 4.3% more than last year and 10.7% more than the previous five-year average. Producers will be looking at pregnancy checking females even more serious this year as production costs continue to rise.”
August beef and dairy cow slaughter was 6% higher year over year, according to USDA’s Economic Research Service (ERS), in the latest monthly Livestock, Dairy and Poultry Outlook. Combined cow slaughter was 7% more through the first four weeks of September, compared to the previous year.
“The increase in cow slaughter is likely the result of weaker margins in the dairy sector, which is affecting herd decisions and concerns about forage availability, and continued drought in parts of the country. These conditions are expected to result in increased cow slaughter in the fourth quarter.” say ERS analysts.
ERS increased forecast beef production for next year by 120 million lbs. to 26.99 billion lbs. on higher anticipated overall cattle slaughter.
“Dry conditions are expected to support relatively large placements in the second half of 2021, supporting a higher forecast of fed cattle slaughter in 2022,” ERS analysts explain. “However, production in the second half of the year will reflect lower placements as a result of expected tighter supplies of cattle outside feedlots in 2022.”