Except for steady to mostly higher in the Southeast, calves and feeder cattle sold mixed last week, based on auction sales monitored by cattle Current.
“Corn made another sharp gain on Tuesday and the recent volatility in that market along with the fact that cattle feeders have been unable to achieve higher prices for fed cattle made buyers conservative on some of the heavier yearlings,” explained the AMS market reporter on hand for Tuesday’s sale at Kingsville Livestock Auction in Missouri, where steers weighing 850-900 lbs. sold $5-$8 lower.
Worries about rising inflation rates and interest rates competed with optimism about pandemic recovery, fueling overall commodity and equity market uncertainty.
The CME Feeder Cattle Index was $4.06 lower week to week on Thursday at $134.85.
Week to week on Friday, Feeder Cattle futures closed an average of $1.94 higher (7¢ to $3.20 higher), except for an average of $3.81 lower in the front two contracts.
“Whiplash is running rampant through Feeder Cattle futures,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Since the start of 2021, March Feeder Cattle futures prices have traded in nearly a $15 range.
“The wide price swings were most evident in January, followed by a much narrower trading range in February. However, futures started March on a negative note, which means there will have to be a large swing to the upside for sellers to see any benefit on the cash market. Summer and fall Feeder Cattle futures contracts tend to rally out of March, but that does not mean much for the spring contracts. All eyes are on the finished cattle market to help determine where feeder cattle prices should be this spring. March-placed cattle generally come off feed in the August and September time period, which means the August Live Cattle market is a major determinant of current feeder cattle prices. If there is a Live Cattle price rally this spring, then that could result in cattle feeders being willing to bet on the come or bet on higher prices in the future, which may mean they will be willing to spend some of their profits to pay up for feeder cattle. The current market dynamics present a great example of why it is important to be an active cattle marketer compared to a passive marketer.”
Rising feed costs continue to hamper calf and feeder cattle prices, as well.
Week to week on Friday, Corn futures closed an average of 9¢ higher through the front six contracts, except for an average of 1¢ lower in near May and Jly.
Week to week on Friday, Soybean futures closed an average of 25¢ higher through the front six contracts.
USDA issues the monthly World Agricultural Supply and Demand Estimates Tuesday (Mar. 9), which hold the potential to add price volatility.
Fed Cattle Trudge Steady
Negotiated cash fed cattle prices continued in the steady rut last week, as packers exploited plentiful supplies and sold-ahead inventory. Plenty of folks also expect more wheat pasture cattle to move this month, given the current value of harvesting a dual-purpose winter wheat crop.
For the week, established trade was steady on a live basis at $114/cwt. in the Southern Plains and Northern Plains. Dressed trade in Nebraska was $2 lower at $180. The previous week, live sales in the western Corn Belt were at $114, with dressed trade at $182.
Week to week on Friday, Live Cattle futures closed an average of 97¢ higher (2¢ to $1.50 higher) except for an average of 70¢ lower in the front two contracts.
As mentioned in the last Cattle Current weekly summary, Kevin Good, vice president of industry relations and analysis at CattleFax sees this year as a tale of two halves.
“There are more cattle in the system early in 2021 with big supplies on feed and heavy weights, however the second part of the year will transition to tighter calf crops and tighter slaughter,” Good explained during the Feb. 24 CattleFax Outlook during the virtual 2021 Cattle Industry Convention Winter Reboot.
CattleFax projects total slaughter this year to be 33.5 million head, which would be 700,000 head more year over year. Average carcass weights are projected 4 lbs. lighter. Beef production is projected 500 million lbs. more than 2020 to 27.6 billion lbs.
Choice boxed beef cutout value was $9.20 lower week to week on Friday at $231.33/cwt. Select was $8.88 lower at $220.85.
Friday to Friday Change
Weekly Auction Receipts
| Mar. 8 | Auction | Direct |
Video/net |
Total |
|
282,800 (+66,000) |
56,700 (+10,600) |
12,900 (-24,400) |
352,400 (+52,200) |
CME Feeder Index
Thursday through Thursday…
| CME Feeder Index* | Mar. 4 | Change |
| $134.85 | – $4.06 |
*Wednesday-to Wednesday for CME Feeder Index
Cash Stocker and Feeder
North Central
| Steers-Cash | Mar. 8 | Change |
| 600-700 lbs. | $155.01 | – $1.06 |
| 700-800 lbs. | $143.04 | – $0.61 |
| 800-900 lbs. | $133.44 | – $2.04 |
South Central
| Steers-Cash | Mar. 8 | Change |
| 500-600 lbs. | $164.47 | + $0.01 |
| 600-700 lbs. | $146.05 | – $1.14 |
| 700-800 lbs. | $135.31 | – $3.06 |
Southeast
| Steers-Cash | Mar. 8 | Change |
| 400-500 lbs. | $164.62 | + $3.28 |
| 500-600 lbs. | $150.78 | + $2.41 |
| 600-700 lbs. | $137.14 | + $1.27 |
(AMS National Weekly Feeder & Stocker Cattle Summary)
Wholesale Beef Value
| Boxed Beef (p.m.) | Mar. 5 ($/cwt) | Change |
| Choice | $231.33 | – $9.20 |
| Select | $220.85 | – $8.88 |
| Ch-Se Spread | $10.48 | – $0.32 |
Futures
| Feeder Cattle | Mar. 5 | Change |
| Mar | $134.600 | – $4.075 |
| Apr | $139.025 | – $3.550 |
| May | $145.150 | + $0.075 |
| Aug | $153.725 | + $1.775 |
| Sep | $154.825 | + $2.000 |
| Oct | $155.375 | + $2.175 |
| Nov | $155.650 | + $2.425 |
| Jan ’22 | $154.850 | + $3.200 |
| Live Cattle | Mar. 5 | Change |
| Apr | $119.025 | – $0.975 |
| Jun | $118.000 | – $0.425 |
| Aug | $117.075 | + $0.025 |
| Oct | $121.450 | + $0.825 |
| Dec | $124.475 | + $1.150 |
| Feb ’22 | $126.900 | + $1.325 |
| Apr | $128.125 | + $1.325 |
| Jun | $122.500 | + $1.500 |
| Aug | $121.125 | + $0.625 |
| Corn | Mar. 5 | Change |
| Mar ’21 | $5.620 | + $0.066 |
| May | $5.454 | – $0.020 |
| Jly | $5.340 | – $0.010 |
| Sep | $4.990 | + $0.096 |
| Oct | $4.814 | + $0.108 |
| Mar ’22 | $4.890 | + $0.106 |
| Oil CME-WTI | Mar. 5 | Change |
| Apr | $66.09 | + $4.59 |
| May | $65.92 | + $4.69 |
| Jun | $65.45 | + $4.71 |
| Jly | $64.81 | + $4.69 |
| Aug | $64.07 | + $4.61 |
| Sep | $63.30 | + $4.49 |
Equities
| Equity Indexes | Mar. 5 | Change |
| Dow Industrial Average | 31496.20 | + 563.93 |
| NASDAQ | 12920.15 | – 272.19 |
| S&P 500 | 3841.94 | + 30.79 |
| Dollar (DXY) | 91.99 | + 1.11 |