Follow through pressure in Lean Hogs, higher Corn futures and Friday’s Cattle on Feed report helped pressure Feeder Cattle futures sharply lower on Monday, while Live Cattle were narrowly mixed but mostly lower.
Except for an average of 29¢ higher in the front two contracts, Live Cattle futures closed an average of 28¢ lower.
Feeder Cattle futures closed an average of $2.05 lower ($1.70 to $2.45 lower).
After a profit-taking breather on Friday, grain futures continued higher on Monday with the latest Crop Progress report (see below) documenting the significant delay in development compared to the average.
Corn futures closed 3¢ to 4¢ higher through Jul ‘20 and then mostly 1¢ to 2¢ higher.
Soybean futures closed 5¢ to 6¢ higher through Jan ’21 and then 2¢ to 3¢ higher.
Wholesale beef values were steady on Choice and firm on Select with light to moderate demand and offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 8¢ lower Monday afternoon at $219.74/cwt. Select was 26¢ higher at $199.81.
Major U.S. financial indices closed narrowly mixed Monday, with traders apparently waiting for more direction from trade talks. President Trump and the Chinese leader are scheduled to meet at the G20 Summit that begins later this week.
The Dow Jones Industrial Average closed 8 points higher. The S&P 500 closed 5 points lower. The NASDAQ was down 26 points.
“The lack of summer thus far has limited seasonal beef demand,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “After early beef buying in April for Memorial Day, boxed beef cutout values have weakened, averaging 3.8% lower year over year for the last six weeks. The daily boxed beef price last Friday was down 6.2% from the peak price in late April. The weakness has been most pronounced in the high value middle meats, with loin primals averaging 7.9% lower year over year for the last six weeks and rib primals averaging 5.5% lower year over year for the same period. Chuck and round primals have fared somewhat better with round primals down only 1.8% year over year and chuck primals up an average of 1.3% over the last six weeks, compared to the same period last year. Both chuck and round values have showed more strength in the latest weekly data. Encouragingly, the ground beef market is showing a little life with both lean trimmings and 50% trimmings currently priced a bit higher compared to last year.”
Although there will likely be pent up demand for the 4th of July, Peel notes current weather forecasts indicate large swaths of the nation will still be experiencing below normal temperatures.
“Moreover, continued flooding and swollen rivers and lakes in some regions will limit recreational activities for some time yet,” Peel says.