Estimated total cattle slaughter last week was 667,000 head, which was 63,000 more than the previous holiday-shortened week. Year-to-date estimated total cattle slaughter of 24.0 million head was 328,000 (+1.4%) more than last year. Estimated year-to-date beef production of 19.8 billion lbs. was 226.9 million lbs. more (+1.2%).
Cattle futures meandered Friday amid the heavy beef production, high Corn price outlook and recently lower wholesale beef values.
Live Cattle futures closed an average of 23¢ lower (5¢ to 35¢ lower).
Feeder Cattle futures closed mixed, from an average of 60¢ lower to 33¢ higher.
Negotiated cash fed cattle trade ranged from slow on light demand to mostly inactive on light demand through Friday afternoon, according to the Agricultural Marketing Service.
For the week, live prices were $1 higher in the Southern Plains at $142/cwt., steady to $1 higher in Nebraska at $143 and steady to $2 lower in the western Corn Belt at $143-$144. Dressed prices were steady to $1 higher in Nebraska at $226-$227. Dressed prices in the western Corn Belt the previous week were $225-$230.
Choice Boxed beef cutout value was 6¢ higher through Friday afternoon at $252.40/cwt. Select was $3.30 lower at $226.65/cwt.
Corn futures closed mixed from fractionally lower to 1¢ higher.
Soybean futures closed an average of 2¢ lower through Sept. ‘23 and then unchanged to fractionally higher.
Major U.S. financial indices lost more ground Friday amid growing global recession fears.
Preliminary quarterly results from FedEx late the previous day underscored the worries.
First-quarter FedEx results were adversely impacted by global volume softness that accelerated in the final weeks of the quarter, according to the company’s update. FedEx Express results were particularly impacted by macroeconomic weakness in Asia and service challenges in Europe.
As a result of the preliminary first quarter financial performance and expectations for a continued volatile operating environment, FedEx withdrew its fiscal year 2023 earnings forecast issued in June.
The Dow Jones Industrial Average closed 139 points lower. The S&P 500 closed 28 points lower. The NASDAQ was down 104 points.
West Texas Intermediate Crude Oil futures on the CME closed 7¢ to 20¢ higher through the front six contracts.
USDA’s Economic Research Service (ERS) raised expected feeder steer prices (750-800 lbs., Oklahoma City) in the latest Livestock, Dairy and Poultry Outlook, compared to the previous month. Forecast prices were $2 higher in the third quarter at $173/cwt. and $4 higher in the fourth quarter to $177. The 2022 annual average prices increased $1.50 to $166.10. Projected prices for the first and second quarters next year increased $3 and $4, respectively to $172 and $190. The forecast 2023 average annual price increased $1.75 to $201.
“Calf prices are raised for 2022 and early 2023 as expected placements in feedlots reach deeper into tight supplies outside feedlots … Based on recent NASS Cattle on Feed reports, average placement weights are declining, suggesting fewer yearlings are available for placement. This has likely improved demand for calves weighing over 700 lbs.,” say ERS analysts. “The price for feeder steers 750-800 lbs. at the Oklahoma City National Stockyards averaged $174.18/cwt. in August, up nearly $5 from last month and $18 from last year. The most recent available price from Sept. 12 reports sales of yearling feeder steers at $180.35, a jump of more than $6 from the previously reported week.”
ERS analysts explain more feedlot placements in July than anticipated, as well as weekly reported sticker and feeder cattle sales in August supports raising anticipated placements in the third quarter of this year.
“This has further resulted in raising expected fed cattle marketings in early 2023 and subsequently raising projected first-quarter 2023 beef production,” ERS analysts say. “As the drought pushes more calves into feedlots at a quicker pace than normal, this will likely pull feeder cattle forward next year, decreasing expected marketings in late 2023.”