Cattle futures rose Monday, helped along by last week’s slightly stronger cash fed cattle prices.
Feeder Cattle futures closed an average of 87¢ higher.
Live Cattle futures closed an average of 37¢ higher., except for 7¢ lower in near Dec.
Negotiated cash fed cattle trade ranged from mostly inactive on very light demand to a standstill through Monday afternoon, according to the Agricultural Marketing Service.
Last week, live prices were $1 higher in the Southern Plains at $142, steady to $1 higher in Nebraska at $143 and steady to $1 lower in the western Corn Belt at $143-$145. Dressed prices were steady to $1 higher in Nebraska at $226-$227 and unevenly steady in the western Corn Belt at $226.
Choice Boxed beef cutout value was 5¢ higher through Monday afternoon at $252.45/cwt. Select was 76¢ lower at $225.89/cwt.
Corn futures closed mostly 1¢ to 2¢ higher.
Soybean futures closed mostly 13¢ to 19¢ higher.
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Major U.S. financial indices closed higher at the end of a volatile session Monday. Investors are awaiting the Fed’s next interest rate decision this week.
The Dow Jones Industrial Average closed 197 points higher. The S&P 500 closed 26 points higher. The NASDAQ was up 86 points.
CME WTI Crude Oil futures closed 44¢ to 62¢ higher through the front six contracts.
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Budgets currently look favorable for winter stocker grazing if forage is available, says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments.
For instance, Peel calculates the value of gain for adding 300 lbs. to a 475-lb. steer at $1.29/lb., using current Oklahoma feeder prices. He notes that price also reflects current feedlot cost of gain for steers in the Southern Plains of $1.25-$1.30/lb.
“Stocker budgets are driven by the overall level of cattle prices and the relationship between purchase prices for lightweight stockers and the expected price of heavy feeder cattle later,” Peel explains. “The difference in the purchase price and selling price of stocker cattle is the rollback that determines the gross value of gain for adding weight to feeder cattle. The stocker price rollback is the mirror image of the cost of gain for feedlots because feeder markets reflect whether it is cheaper to put weight on feeder cattle in forage-based stocker programs before they arrive at the feedlot or with grain-based rations after placement in the feedlot.” He adds the $7 increase between nearby and Mar Feeder Cattle contracts adds more value.
Unfortunately, at least for producers depending on wheat pasture in the Southern Plains, grazing prospects appear limited due to persistent dryness and drought.
“I traveled across much of western Oklahoma last week and did see several planted fields and even a couple with wheat emerged. In many cases the wheat is being “dusted in”, planted in dry soil, hoping that rain will be forthcoming to germinate the wheat,” Peel says. “Whether wheat is planted with enough moisture to germinate or is waiting for rain to emerge, the dry soil profile means that additional timely rains will be needed to sustain a wheat stand. The forecast for the next week or more is for unseasonably (maybe record!) warm temperatures with little chance of precipitation. Wheat grazing prospects look dim and risky this fall.”