Cattle Current Weekly Highlights-Week ending Sept. 28, 2018

Cattle Current Weekly Highlights-Week ending Sept. 28, 2018

Cash and futures prices for cattle mostly faded the pressure of the previous week’s bearish monthly Cattle on Feed report.

Nationwide, steers and heifers sold uneven, from $2/cwt. lower to $2 higher, according to the Agricultural Marketing Service (AMS).

“Herd health programs are becoming more of an issue earlier this year as temperature swings in the Midwest are ranging from the lows in the 40s to the highs in the mid 80s in a matter of a couple of days,” explained AMS analysts.

Week to week on Friday Feeder Cattle futures closed 20¢ lower to 25¢ higher across the front half of the board and then an average of 74¢ higher. That’s not counting expiring spot Sep or newly minted away Sep.

Negotiated cash fed cattle trade was mainly steady with the previous week at $110-$111/cwt. on a live basis and mostly $174 in the beef.

“Last week’s large harvest of 657,000 head, if realized, will be the second largest harvest since July 1 and has the packers well supplied,” AMS analysts explain. “Coupled with this week’s harvest of 650,000 head, it would be the largest two-week total since mid-June.”

Live Cattle futures closed an average of 44¢ higher (2¢ to 75¢ higher).

Moreover, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, says in his weekly market comments,  “Lightweight placements since May will result in lighter and later fed cattle marketings and may contribute to relatively tighter fed cattle supplies for the remainder of the year.

“Despite more cattle on feed, the market price of finished cattle remains strong and continues to outperform year-ago prices,” said Andrew P. Griffith, agricultural economist at the University of Tennessee, in his market comments two weeks ago. “Cattle feeders continue to fill pens and the strong feeder cattle prices demonstrate how much cattle feeders want to purchase cattle. It would appear cattle feeders are expecting finished cattle prices to remain strong in the near term and escalate moving into 2019. This thought process may not be as wild as many think it is as beef demand remains strong, which supports prices. Does this mean finished cattle prices will only escalate through the end of the year? One should probably not be so bold at this juncture, but the market does appear to be holding its own plus some at this time.”

For demand perspective, Griffith notes the retail value for Choice beef retail value in August was the highest since July of last year at 608.2¢/lb.

Wholesale beef values continued seasonally lower. Week to week, Choice boxed beef cutout value was 92¢ lower Friday afternoon at $203.88 per cwt. Select was $1.27 lower at $193.44.

Cold Storage Increases

Total pounds of beef in freezers Aug. 31 were 4% more than the previous month and 6% more than the same time a year earlier, according to USDA’s monthly Cold Storage report.

Frozen pork supplies were 6% more than the previous month and 1% more than last year.

Total red meat supplies in cold storage were 4% more than the previous month and year.

Total frozen pork supplies were 5% more than the previous month and 11% more than the same time last year.

“There is no doubt there is a lot of meat in cold storage, but when put in relative terms, the numbers do not seem so large,” says Griffith, in  his market comments this week. “For instance, weekly beef production in 2018 has averaged 506 million lbs., which means there is one week’s worth of beef production in cold storage. Similarly, weekly pork production has averaged 490 million lbs. meaning there is just over a week’s worth of pork production in cold storage. One should note, the products (cuts, grind) in cold storage do not align with the products fabricated each week.”

Friday to Friday Change*

Weekly Auction Receipts

Receipts

Sept. 28

Auction (head)

(Change)

Direct (head)

(Change)

Video/net (head)

(Change)

Total (head)

(Change)

 

185,400

(+6,900)

47,000

(-67,500)

1,900

(-38,100)

234,300

(-96,000)

 

CME Feeder Index

CME Feeder Index Sept. 27 Change
  $156.89   +   $0.60

*Thursday-to Thursday for CME Feeder Index

 

Cash Stocker and Feeder

North Central

Steers-Cash Sept. 28  Change 
600-700 lbs. $165.48 –    $1.89
700-800 lbs. $161.70 –    $5.39
800-900 lbs. $157.17 –    $2.75

South Central

Steers-Cash Sept. 28 Change
500-600 lbs. $165.71 –    $1.10
600-700 lbs. $160.53 –    $1.15
700-800 lbs. $158.17 +   $1.56

Southeast

Steers-Cash Sept. 28 Change 
400-500 lbs. $160.73 –   $3.83
500-600 lbs. $152.78 +  $0.93
600-700 lbs. $145.63 +  $2.06

(AMS National Weekly Feeder & Stocker Cattle Summary)

 

Wholesale Beef Value

Boxed Beef  (p.m.) Sept. 28 ($/cwt) Change
Choice $203.88 –   $0.92
Select $193.44 –   $1.27   
Ch-Se Spread $10.44 +  $0.35

 

Futures

Feeder Cattle  Sept. 28 Change
Oct $158.175 +   $0.100
Nov $158.050 +   $0.250
Jan ’19 $154.650 –    $0.200
Mar $153.300 +   $0.575
Apr $153.575 +   $0.825
May $153.175 +   $0.700
Aug $154.850 +   $0.875
Sep $154.500 n/a

 

Live Cattle   Sept. 28 Change
Oct $113.450 +  $0.375
Dec $118.850 +  $0.400
Feb ’19 $122.800 +  $0.550
Apr $123.900 +  $0.475
Jun $116.675 +  $0.675
Aug $114.475 +  $0.425
Oct $115.550 +  $0.250
Dec $116.775 +  $0.025
Feb ’20 $118.000 +  $0.750

 

Corn futures Sept. 28 Change
Dec $3.562 –    $0.010
Mar ’19 $3.680 –    $0.012
May $3.756 –    $0.016
Jul $3.812 –    $0.020
Sep $3.850 –    $0.024
Dec $3.912 –    $0.024

 

Oil CME-WTI Sept. 28 Change
Nov $73.25 +   $2.47
Dec $73.06 +   $2.69
Jan ’19 $72.89 +   $2.83
Feb $72.70 +   $2.91
Mar $72.51 +   $2.93
Apr $72.31 +   $2.95

 

Equities

Equity Indexes Sept. 28 Change
Dow Industrial Average  26458.31 –     285.19
NASDAQ    8046.35 +      59.39
S&P 500     2913.98 –       15.69
Dollar (DXY)          95.17 +       0.96
2018-09-30T16:53:21-06:00

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