Negotiated cash fed cattle trade remained undeveloped Wednesday, though auctions began providing some indicators, albeit mixed.
For instance, Ch 2-4 steers brought $109.74 to $110.00 on a jag of 205 head. But,
Ch 2-3 steers brought $106-$109 at Sioux Falls Regional Livestock in South Dakota.
Only 444 head were offered in the weekly Fed Cattle Exchange auction Wednesday, with no takers. There were three lots passed out at $108.00-$108.25/cwt.
Cattle futures took a strong step higher Wednesday. Lower grain prices—tied to the World Agricultural Supply and Demand Estimates—helped lift Feeder Cattle, dragging Live Cattle along.
Live Cattle futures closed an average of $1.14 higher (85¢ to $2.17 higher in spot Oct).
Feeder Cattle futures closed an average of $2.00 higher ($1.32 to $2.57 higher).
Wholesale beef values were lower on light to moderate demand and moderate offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was $1.28 lower Wednesday afternoon at $204.79/cwt. Select was $1.04 lower at $197.27.
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Major U.S. financial indices closed narrowly mixed Wednesday. Support included reports that the U.S. is in the process of proposing new trade talks with China.
The Dow Jones Industrial Average closed 27 points higher. The S&P 500 closed 1 point higher. The NASDAQ was down 18 points.
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Projected beef production of 27.09 billion lbs. was unchanged in the latest monthly World Agricultural Supply and Demand Estimates (WASDE), with anticipated increases in slaughter during the second half of the year offset by an expected decrease in carcass weights.
Fed steer prices (5-area Direct) are projected at $108-$111/cwt. for the third quarter and at $108-$114 in the fourth quarter. Forecast prices for the first and second quarter next year are projected to be $116-$126 and $118-$128, respectively.
Beef production is forecast at 27.72 billion next year. Total red meat production is projected at 55.81 billion next year. Total red meat and poultry production next year is estimated at 105.76 billion lbs., which would be 2.7 billion lbs. more than this year’s estimate.