Cattle markets stabilized last week, with Cattle futures finally finding some traction and fed cattle trading about steady, supporting calf and feeder cattle prices. Feeder steers and heifers sold mostly steady to $5/cwt. higher, according to the Agricultural Marketing Service (AMS).
Feeder Cattle futures closed an average of $3.91 higher week to week on Friday.
Except for $4.32 higher in spot Apr and 97¢ higher at the back of the board, Live Cattle futures closed an average of $1.74 higher week to week on Friday.
“The question will be if there is any follow through next week to keep prices pushing higher,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “If one was strictly using the futures market, it could be said that feeder cattle prices have already out-priced live cattle. However, if one considers the strong basis live cattle have been experiencing for several months, then feeder cattle prices are much more in line with expectations. The feeder cattle market will follow the live cattle market closely the next few weeks, but the summer months could bring some strength to feeder cattle.”
Increased fed cattle supplies are still looming, of course. But, there appears to be a gap in harvest-ready supplies, especially up North, due to tough and extended winter conditions. At the very least, some of the expected supply increase likely will be spaced out over a longer period of time than originally expected.
Limited fed cattle sales reported through mid Friday afternoon were generally steady with the previous week to $1 on either side of steady at mostly $117-$120/cwt.
“Analysts have been watching very closely the amount of cattle being purchased by packers the past few weeks,” AMS analysts explain. “Many producers are very diligent and staying current with their marketings as cattle in the Southern Plains have been gaining very well this winter. However, in the Northern Plains, wet pens increase the cost of gains and decrease the yield on cattle that have had to slog through mud to get to the feed bunk. Excessive winter moisture brings about the question of how long will it take all the calf-feds to get through the pipeline this year.”
Griffith points out June Live Cattle futures are trading at a $13 discount to April, with the August contract showing a similar discount.
“As has been said previously, it is hard to imagine a $13 decline on finished cattle in the next two months,” Griffith says. “Finished cattle prices are certain to come under pressure this summer, but $13 seems to be an excessive discount between April and June, given that April finished-cattle prices are generally strong.”
The long winter is also delaying the seasonal uptick in wholesale beef values.
Week to week on Friday, Choice boxed beef cutout value was $1.70 lower at $212.61 per cwt. Select was $5.69 lower at $199.91.
“Grills need to be fired up in the Midwest and the Northeast to get the cutout to move up,” AMS analysts say. “With Mother’s Day, Memorial Day, Father’s Day and Independence Day on the horizon, retailers are getting ready to start their spring and early summer procurement.”
“Despite wholesale beef prices falling, the retail price of beef remains strong,” Griffith says. “The all-fresh beef retail price for March was 559.8¢/lb., which is 6.8¢/lb. higher than February and 5.0¢/lb. higher than March 2017. It would appear the retail sector is looking to recapture some lost margins from previous months.”
Friday to Friday Change*
Weekly Auction Receipts
|
Receipts Apr. 13 |
Auction (head) (Change) |
Direct (head) (Change) |
Video/net (head) (Change) |
Total (head) (Change) |
|
205,400 (+73,500) |
53,300 (+21,800) |
18,600 (-14,700) |
277,300 (+80,600) |
CME Feeder Index
| CME Feeder Index | Apr. 12 | Change |
| $136.42 | + 1.01 |
*Thursday-to Thursday for CME Feeder Index
Cash Stocker and Feeder
North Central
| Steers-Cash | Apr. 13 | Change |
| 600-700 lbs. | $167.27 | + $3.93 |
| 700-800 lbs. | $149.03 | + $3.56 |
| 800-900 lbs. | $136.77 | + $3.34 |
South Central
| Steers-Cash | Apr. 13 | Change |
| 500-600 lbs. | $167.54 | + $1.92 |
| 600-700 lbs. | $155.18 | + $0.98 |
| 700-800 lbs. | $142.04 | + $1.58 |
Southeast
| Steers-Cash | Apr. 13 | Change |
| 400-500 lbs. | $166.72 | + $2.66 |
| 500-600 lbs. | $155.45 | + $2.88 |
| 600-700 lbs. | $143.60 | + $1.89 |
(AMS National Weekly Feeder & Stocker Cattle Summary)
Wholesale Beef Value
| Boxed Beef (p.m.) | Apr. 13 ($/cwt) | Change |
| Choice | $212.61 | – $1.70 |
| Select | $199.91 | – $5.69 |
| Ch-Se Spread | $12.70 | + $3.99 |
Futures
| Feeder Cattle | Apr. 13 | Change |
| Apr | $139.375 | + $4.050 |
| May | $140.375 | + $4.750 |
| Aug | $145.100 | + $3.650 |
| Sep | $146.575 | + $4.275 |
| Oct | $146.900 | + $4.275 |
| Nov | $146.250 | + $3.650 |
| Jan ’19 | $142.100 | + $3.250 |
| Mar | $139.375 | + $3.400 |
| Live Cattle | Apr. 13 | Change |
| Apr | $116.550 | + $4.325 |
| Jun | $103.650 | + $1.325 |
| Aug | $104.275 | + $1.500 |
| Oct | $108.725 | + $2.025 |
| Dec | $112.950 | + $1.800 |
| Feb ’19 | $114.800 | + $2.250 |
| Apr | $115.450 | + $2.125 |
| Jun | $108.800 | + $1.150 |
| Aug | $107.850 | + $0.975 |
| Corn futures | Apr. 13 | Change |
| May | $3.862 | – $0.022 |
| Jul | $3.944 | – $0.026 |
| Sep | $4.014 | – $0.026 |
| Dec | $4.106 | – $0.018 |
| Mar ’19 | $4.182 | – $0.018 |
| May | $4.224 | – $0.020 |
| Oil CME-WTI | Apr. 13 | Change |
| May | $67.39 | + $5.33 |
| Jun | $67.33 | + $5.23 |
| Jul | $67.00 | + $5.04 |
| Aug | $66.45 | + $4.81 |
| Sep | $65.85 | + $4.59 |
| Oct | $65.23 | + $4.36 |
Equities
| Equity Indexes | Apr. 13 | Change |
| Dow Industrial Average | 24360.14 | + 427.38 |
| NASDAQ | 7106.65 | + 191.54 |
| S&P 500 | 2656.30 | + 51.83 |
| Dollar (DXY) | 89.79 | – 0.34 |