Steers and heifers sold steady to $3/cwt. lower last week, according to the Agricultural Marketing Service (AMS).
“Demand was moderate to good in most regions as cattle feeders looked to fill orders to take advantage of the market reflected in the 2020 CME Live Cattle contracts,” said AMS analysts. “With the holidays and end of the year fast approaching, many auction barns had heavy runs as marketing opportunities will be limited after next week.”
In Tennessee, for instance, Andrew P. Griffith notes auction receipts were atypically high the last couple of weeks.
“Many producers that hold onto cattle into December generally hold them until the beginning of the next year since there is generally a bump in prices and for tax reasons,” Griffith explains, in his weekly market comments. “What makes strong receipts even more puzzling is that soft prices continue to dominate the market. Many cattle producers continue to be disappointed in calf and feeder cattle prices but continue to sell calves.” He expects resource constraints are part of the explanation.
Feeder Cattle futures closed an average of $3.06 higher week to week on Friday ($1.45 higher toward the back to $4.57 higher near the front).
Negotiated cash fed cattle trade continued to develop through Friday afternoon at no worse than steady money, according to USDA reports. Early live sales were at $119/cwt. in Nebraska and at $120 in the western Corn Belt. Early dressed sales were steady in the western Corn Belt at $188 and as much as $6 higher in Nebraska at $188-$194. Earlier in the week, live sales were steady in Kansas at $119. The Texas Cattle Feeders Association reported its members selling steers steady at $119 and heifers $1 higher at nearly $119.
Live Cattle futures closed an average of $1.94 higher week to week on Friday ($1.42 to $2.85 higher).
In the latest monthly World Agricultural Supply and Demand Estimates, USDA increased the projected average fed steer price (5-area-direct) in the fourth quarter by $3 to $115/cwt., compared to the previous month. The estimated annual average price for 2019 increased $1 to $117.
For next year, the average fed steer price is projected $2 higher at $122 in the first-quarter; $1 higher in the second quarter at $118; $1 lower in the third quarter at $112. Next year’s annual average price was estimated $1 higher at $117.
Wholesale beef values continued searching for a seasonal bottom. Choice boxed beef cutout value was $8.27 lower week to week on Friday at $216.29/cwt. Select was $3.06 lower at $204.24.
“The all fresh beef retail value registered at $5.82/lb. in November which is 4.5¢ higher than the previous month and nearly 12¢ higher than November a year ago,” Griffith says. “The Choice beef retail value for November was even more impressive as it was $6.06/lb., which represented more than a 17¢ increase from October and a 15¢ increase from one year ago. The expectation could be for retail value of beef to continue escalating given that wholesale beef prices in November were 7.7% percent higher than the previous month. Another factor that may soon influence retail beef prices is the announced deal with China that sent equity markets soaring. It is difficult to fathom that a deal with China will result in a lot of U.S. beef going to China, but it could help clear some pork and poultry stocks which would pull down some of the meat protein stocks. This is a situation that is worthy of beef cattle producers’ attention as it could provide sup-port or continue to weigh on the market.”
Friday to Friday Change*
Weekly Auction Receipts
| Dec. 13 | Auction | Direct |
Video/net |
Total |
|
347,200 (+60,300) |
34,400 (+8,400) |
1,900 (-54,800) |
383,500 (+13,900) |
CME Feeder Index
| CME Feeder Index* | Dec. 12 | Change |
| $143.40 | – $1.09 |
*Thursday-to Thursday for CME Feeder Index
Cash Stocker and Feeder
North Central
| Steers-Cash | Dec. 13 | Change |
| 600-700 lbs. | $151.57 | – $0.50 |
| 700-800 lbs. | $145.33 | – $1.43 |
| 800-900 lbs. | $144.65 | – $1.68 |
South Central
| Steers-Cash | Dec. 13 | Change |
| 500-600 lbs. | $150.59 | – $4.73 |
| 600-700 lbs. | $144.56 | – $1.28 |
| 700-800 lbs. | $143.73 | + $0.06 |
Southeast
| Steers-Cash | Dec. 13 | Change |
| 400-500 lbs. | $146.57 | – $0.58 |
| 500-600 lbs. | $133.77 | – $3.59 |
| 600-700 lbs. | $132.48 | + $0.88 |
(AMS National Weekly Feeder & Stocker Cattle Summary)
Wholesale Beef Value
| Boxed Beef (p.m.) | Dec. 13 ($/cwt) | Change |
| Choice | $216.29 | – $8.27 |
| Select | $204.24 | – $3.06 |
| Ch-Se Spread | $12.05 | – $5.21 |
Futures
| Feeder Cattle | Dec. 13 | Change |
| Jan ’20 | $145.675 | + $4.125 |
| Mar | $146.250 | + $4.575 |
| Apr | $148.050 | + $4.275 |
| May | $148.600 | + $3.525 |
| Aug | $152.900 | + $2.825 |
| Sep | $153.000 | + $2.100 |
| Oct | $152.850 | + $1.450 |
| Nov | $152.450 | + $1.600 |
| Live Cattle | Dec. 13 | Change |
| Dec | $122.375 | + $2.175 |
| Feb ’20 | $127.550 | + $2.575 |
| Apr | $128.200 | + $2.850 |
| Jun | $119.425 | + $2.275 |
| Aug | $116.400 | + $1.700 |
| Oct | $117.675 | + $1.550 |
| Dec | $119.900 | + $1.425 |
| Feb ’21 | $121.775 | + $1.425 |
| Apr | $122.275 | + $1.525 |
| Corn futures | Dec. 13 | Change |
| Dec | $3.662 | – $0.002 |
| Mar ’20 | $3.810 | + $0.044 |
| May | $3.880 | + $0.056 |
| Jul | $3.936 | + $0.070 |
| Sep | $3.930 | + $0.064 |
| Dec | $3.952 | + $0.050 |
| Oil CME-WTI | Dec. 13 | Change |
| Jan ’20 | $60.07 | + $0.87 |
| Feb | $59.98 | + $0.88 |
| Mar | $59.67 | + $0.89 |
| Apr | $59.26 | + $0.89 |
| May | $58.80 | + $0.88 |
| Jun | $58.33 | + $0.90 |
Equities
| Equity Indexes | Dec. 13 | Change |
| Dow Industrial Average | 28135.88 | + 120.82 |
| NASDAQ | 8734.88 | + 78.35 |
| S&P 500 | 3168.80 | + 22.89 |
| Dollar (DXY) | 97.18 | – 0.50 |