Daily-May 29-30

Daily-May 29-30

Lower cash fed cattle prices and the bearish Cattle on Feed report (see below) helped pressure Cattle futures to sharp losses on Friday.

Live Cattle futures closed an average of $2.17 lower ($1.22 to $2.85 lower).

Feeder Cattle futures closed an average of $4.02 lower ($3.52 to $4.30 lower).

Corn futures closed 3¢ to 5¢ higher.

Choice boxed beef cutout value was 51¢ lower Friday afternoon. Select was 53¢ lower. The Choice-Select spread was $27.15/cwt.

Even so, analysts with the Agricultural Marketing Service explained on Friday, “The feeder market continues to thrive despite slaughter cattle losing ground on Wednesday in direct feedlot trade. The momentum from the previous week’s positive advances continued to lend support and add confidence in the minds of feeder buyers.”  

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Wall Street investors seemed content to drift into the holiday weekend, with major U.S. financial indices treading water on Friday.

The Dow Jones Industrial Average closed 2 points lower. The S&P 500 closed fractionally higher. The NASDAQ closed 4 points higher.

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Friday’s monthly Cattle on Feed report will likely add pressure to calf prices, at least as the week begins.

Plenty of analysts were correct in thinking April feedlot placements would be higher, but most were too conservative in how broadly feedlots would respond to the spring rally in fed cattle prices.

April feedlot placements of 1.85 million head were 11% higher than the previous year. That’s about 4% more than pre-release estimates, according to Griffith.

In terms of weights, 53.2% (985,000 head) weighed 700-899 lbs. On the lighter end, 18.8% of the placements (348,000 head) went on feed weighing 600 lbs. or less.

Marketings of 1.70 million head were 3% more than last year, compared to estimates ahead of the report of 1.7%.

The net result is an on-feed inventory May 1 that was 2% more than a year earlier at 11.o million head. Most estimates ahead of the report forecast an inventory even with last year.

2017-05-30T13:31:22-05:00

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