Fed cattle were higher again this week. Across the major feeding region most live sales were $2/cwt higher and dressed sales were $4/cwt higher. In the Southern Plains live cattle traded at $127-$127.50/cwt. In Nebraska, live and dressed cattle traded at $126-$128/cwt and $197/cwt, respectively. Iowa and Minnesota live cattle sold at $125/cwt and at $195-$198/cwt for dressed. In Oklahoma City, feeder steers and heifers under 800 pounds were steady to $2/cwt higher. Feeder steers and heifers were $1-$5/cwt higher in Mississippi auctions this week, while slaughter cows were $1-$2/cwt higher and bulls were $1-$3/cwt higher.
Live cattle futures moved higher each day until Friday. The nearby October contract experienced the largest weekly gain at +$2.40/cwt, while gains were smaller as the contract month moved out with August 2013 live cattle up just under $1/cwt. Similarly, feeder cattle were much higher on the front months as compared to more deferred contract months. A number of fundamental positives played into the higher prices this week. First, strength in both cash cattle and boxed beef provided support. Furthermore, a weaker U.S. dollar mid-week and gains the stock market also helped. Stock market weakness on Friday coupled with traders exiting positions ahead of this month’s Cattle on Feed report added pressure to end the week. The on feed report will likely be viewed as mildy bullish to neutral with placements down much more than expected, which was offset a bit by lower than anticipated marketings leaving all cattle on feed in-line with expectations. For more on the report visit here (link).
Corn futures started the week sharply lower but rallied at the week’s end to finish near last week’s close. Pressure from the soybean pit and concerns over demand rationing pushed prices lower on Monday and followed through on Tuesday. Weakness for the U.S. dollar mid-week helped spark a rally with most hoping it would turn the sluggish export picture around. A flip-flop regarding demand rationing was seen Thursday with many thinking livestock users would re-enter the market with cattle prices moving higher.
Wholesale boxed beef prices moved sharply higher this week. Choice finished with a weekly average of $195.65/cwt, up $4.50. Select beef averaged $180.30/cwt for the week, up $3.30.