Significantly higher June feedlot placements than anticipated (reported in the monthly Cattle on Feed report a week earlier) pressured cash and futures prices for feeder cattle, especially early in the week.
Yearling steers and heifers sold mostly steady to $8 lower, according to the Agricultural Marketing Service (AMS), although some late-week sales trended $4-$6 higher. A light offering of calves nationwide traded from $4 lower to $4 higher.
“Receipts were light in the major sale barns as cattle producers sat on the sidelines and waited to see how the market would react to the negative news (Cattle on Feed report),” AMS analysts say. “The extreme hot temperatures early on also kept producers from moving cattle.”
Feeder cattle futures closed an average of $4.38 lower week to week on Friday ($2.67 to $6.90 lower).
Additional market pressure stemmed from talks that Japan might increase the tariff on frozen beef from the U.S. and other countries via a safeguard mechanism that goes back to 1994. Japan confirmed on Friday that it will employ the safeguard. The tariff on frozen U.S. beef exported to Japan will increase from 38.5% to 50.0%, beginning Aug. 1 and last through March of next year.
Negotiated cash fed cattle trade was mainly $1-$3 lower than the previous week at mostly $117/cwt. Dressed trade was $1-$4 lower at $187-$188.
Live Cattle futures closed an average of $3.24 lower week to week on Friday ($1.87 to $4.97 lower).
Choice boxed beef cutout value was 69¢ lower week to week on Friday afternoon at $206.22/cwt. Select was $2.02 higher at $196.82.
“Strong demand for beef has helped support beef prices the first seven months of the year,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Domestic demand is expected to remain strong, but export demand is less certain considering several trade issues and policy. Packers will continue harvesting a large number of cattle as long as margins are positive.”
Friday to Friday Change*
Weekly Auction Receipts
| Receipts | Auction | Change | Direct | Change | Video/Internet | Change | Total | Change |
| July 28 | 116,800 | -4,500 | 40,600 | -26,500 | 94,300 | -140,600 | 251,700 | -171,600 |
CME Feeder Index
| CME Feeder Index | July 27 | Change |
| $149.36 | + $0.33 |
*Thursday-to Thursday for CME Feeder Index
Cash Stocker and Feeder
North Central
| Steers-Cash | July 28 | Change |
| 600-700 lbs. | $169.21 | – $10.44 |
| 700-800 lbs. | $160.71 | – $5.82 |
| 800-900 lbs. | $157.68 | + $0.61 |
South Central
| Steers-Cash | July 28 | Change |
| 500-600 lbs. | $163.19 | + $0.38 |
| 600-700 lbs. | $157.04 | – $1.19 |
| 700-800 lbs. | $150.01 | – $3.15 |
Southeast
| Steers-Cash | July 28 | Change |
| 400-500 lbs. | $157.39 | – $1.24 |
| 500-600 lbs. | $149.61 | – $1.56 |
| 600-700 lbs. | $143.56 | – $4.73 |
(AMS National Weekly Feeder & Stocker Cattle Summary)
Wholesale Beef Value
| Boxed Beef (p.m.) | July 28 ($/cwt) | Change |
| Choice | $206.22 | – $0.69 |
| Select | $196.82 | + $2.02 |
| Ch-Se Spread | $9.40 | – $2.71 |
Futures
| Feeder Cattle | July 28 | Change |
| Aug | $146.050 | – $6.900 |
| Sep | $147.100 | – $6.050 |
| Oct | $146.850 | – $5.100 |
| Nov | $145.800 | – $4.625 |
| Jan ’18 | $143.325 | – $3.725 |
| Mar | $141.100 | – $2.700 |
| Apr | $139.775 | – $2.675 |
| Aug | $137.975 | – $3.275 |
| Live Cattle | July 28 | Change |
| Aug | $112.900 | – $3.525 |
| Oct | $112.425 | – $4.975 |
| Dec | $113.400 | – $4.775 |
| Feb ’18 | $115.275 | – $4.100 |
| Apr | $115.350 | – $3.225 |
| Jun | $109.325 | – $2.500 |
| Aug | $107.750 | – $2.250 |
| Oct | $108.050 | – $1.975 |
| Dec | $108.475 | – $1.875 |
| Corn futures | July 28 | Change |
| Sep | $3.742 | – $0.054 |
| Dec | $3.880 | – $0.054 |
| Mar ’18 | $3.996 | – $0.048 |
| May | $4.050 | – $0.044 |
| Jul | $4.100 | – $0.042 |
| Sep | $4.124 | – $0.020 |
| Oil CME-WTI | July 28 | Change |
| Sep | $49.71 | + $3.94 |
| Oct | $49.81 | + $3.86 |
| Nov | $49.93 | + $3.74 |
| Dec | $50.00 | + $3.55 |
| Jan ’18 | $50.06 | + $3.37 |
| Feb | $50.08 | + $3.21 |
Equities
| Equity Indexes | July 28 | Change |
| Dow Industrial Average | 21830.31 | + 250.24 |
| NASDAQ | 6374.68 | – 13.07 |
| S&P 500 | 2472.10 | – 0.44 |
| Dollar (DXY) | 93.25 | – 0.60 |