Live Cattle futures meandered to a narrowly lower close Tuesday, with pressure and support apparently capped by strong trader interest in surging Lean Hog futures. Feeder Cattle closed lower on light trade, across a wide range.
Live Cattle futures closed an average of 29¢ lower.
Feeder Cattle futures closed an average of 80¢ lower, (7¢ lower in the back contract to $1.50 lower in spot Sep).
Wholesale beef values were lower on light to moderate demand and heavy offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 75¢ lower Tuesday afternoon at $205.29/cwt. Select was $1.91 lower at $195.47.
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Major U.S. financial indices closed higher Tuesday, with investors reportedly less concerned about the recently announced added tariffs on Chinese imports.
The Dow Jones Industrial Average closed 184 points higher. The S&P 500 closed 15 points higher. The NASDAQ was up 60 points.
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Byproduct values continue to languish, pressured by significantly lower hide prices.
“Heavy steer hides set the lowest weekly average value since 2012 this July, at $68.40 per piece,” according to analysts with the Livestock Marketing Information Center (LMIC), in the latest Livestock Monitor. “The average weekly value during this five-year timeframe is $104.67 per piece. In the second week of September, the price hit $69.33, nearly 35% off the average weekly value…That in part could be related to certain companies moving away from real leather in favor of synthetics, dampening demand. Also, the supply of hides has grown as slaughter rates have increased…On a per-head basis, the weakness in hide prices is knocking off more than $25 per animal compared to the five-year average.”
Hides are the primary contributor to the cattle by-product calculation.
For the most recent week (ending Sept. 7), steer by-product value was down 12%/cwt., compared to last year, according to LMIC. For the last year, the daily reported steer byproduct value has ranged from $9.01 to $10.86/cwt.