Steers and heifers sold steady to $5/cwt. lower, weighed down by volume, seasonal pressure and the weather in some cases.
“An established pre-weaning and vaccination program has become a must for producers to receive top dollar this time of year (in between Halloween and Thanksgiving),” explain analysts with the Agricultural Marketing Service (AMS).
“Many feedyards in the Upper Midwest and the Northern Plains have seen
their fair share of snow already this year…Muddy pens are sure to be a concern moving forward as the days get shorter, however temperatures in the teens in the midsection of the country may bring a welcomed freeze to ground conditions,” AMS analysts say. “Wind chills will be a concern this week, especially on incoming feedlot cattle, but it could be a blessing in disguise if copious amounts of precipitation can hold off for a little while longer.”
Cash prices for calves and feeder cattle also were pressured by crumbling Cattle futures and a growing sense by some that the supportive fundamentals of snugger fed cattle supplies may have been priced in long ago, with trader attention now focused on increasing supplies next year.
Feeder Cattle futures closed an average of $5.43 lower week to week on Friday.
Negotiated cash fed cattle prices lost ground. Live sales were mainly $1-$2 lower at mostly $114-$115/cwt. ($111-$113 in the western Corn Belt). Dressed trade was steady to $3 lower at $177-$180.
Live Cattle futures closed an average of $2.62 lower week to week on Friday ($1.40¢ to $4.40 lower).
“Many cattle feeders were asking as high as $118 through most of the week but settled for lower money as packer bids were lower due to the failure of wholesale beef prices escalating,” explains Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “The price decline also coincides with live cattle futures losing value. The December live cattle contract traded near $117 most of last week, but it lost big on Monday and spent much of the week between $115 and $116 before surging higher on Thursday. Friday futures trade was not kind to cattle feeders as live cattle prices took another nosedive. It is perceived this weakness will be short lived.”
Following several weeks of seasonally higher prices, wholesale beef value faltered.
Week to week, Choice boxed beef cutout value was $3.30 lower Friday afternoon at $215.20/cwt. Select was $2.75 lower at $198.72.
Griffith suspects the Choice cutout reached its fourth-quarter price peak since holiday purchasing will begin to slow.
“The Choice beef market has been driven by the rib and loin primals with a little bit of help from the brisket. The next round of support for the beef market will be from the restocking of meat counters following consumer holiday purchasing. However, the restocking of the counter will come in the form of end meats including chucks and rounds,” Griffith explains. “As this shift begins, the Choice-Select spread will narrow, and most of the narrowing is likely to come from lower Choice prices rather than a strengthening Select beef market. Change is soon to occur but the beef market is strong.”
Friday to Friday Change*
Weekly Auction Receipts
CME Feeder Index
|CME Feeder Index||Nov. 8||Change|
*Thursday-to Thursday for CME Feeder Index
Cash Stocker and Feeder
|600-700 lbs.||$156.60||– $2.56|
|700-800 lbs.||$155.67||– $3.88|
|800-900 lbs.||$152.87||– $2.44|
|500-600 lbs.||$159.50||– $0.79|
|600-700 lbs.||$151.50||– $2.32|
|700-800 lbs.||$151.14||– $1.60|
|400-500 lbs.||$155.46||+ $0.87|
|500-600 lbs.||$146.10||– $0.98|
|600-700 lbs.||$137.51||– $0.79|
(AMS National Weekly Feeder & Stocker Cattle Summary)
Wholesale Beef Value
|Boxed Beef (p.m.)||Nov. 9 ($/cwt)||Change|
|Ch-Se Spread||$16.48||– $0.55|
|Feeder Cattle||Nov. 9||Change|
|Jan ’19||$143.800||– $5.950|
|Live Cattle||Nov. 9||Change|
|Feb ’19||$117.800||– $4.400|
|Feb ’20||$117.000||– $1.975|
|Corn futures||Nov. 9||Change|
|Mar ’19||$3.812||– $0.020|
|Oil CME-WTI||Nov. 9||Change|
|Jan ’19||$60.36||– $2.92|
|Equity Indexes||Nov. 9||Change|
|Dow Industrial Average||25989.30||+ 718.47|
|S&P 500||2781.01||+ 57.95|
|Dollar (DXY)||96.91||+ 0.41|