Cash cattle were lower this week. The five-area live and dressed steer price finished the week at $130.95 and $206.04, respectively, down $1.24 and $3.03. Trading in the Southern Plains was called at $131. In Nebraska, live cattle sold at $131-$132 and there were not enough sales in the Western Cornbelt to make a call.
Feeder steers and heifers in Oklahoma City sold steady and calves were $1-$3 higher. In Mississippi sales this week, feeder steers were $3-$4 lower, feeder heifers were mixed and all calves were steady to $10 higher. Cull cows were $1-$2 higher and bulls were steady. Replacement females were steady to $50 per head higher.
Live cattle futures contracts ended the week in positive territory compared to the previous Friday’s close. The market began to soften mid-week as demand pressures and a lack of improved cash trade led the discussion. Friday brought about a significant jump as conditions in the general economy improved which typically corresponds to a better outlook for beef demand. Employers added 204,000 jobs in October compared to an expected 120,000 from analysts. The numbers for September and August were revised higher by 60,000 each. So, needless to say the report was quite positive. On the flip side, the unemployment rate came in 0.1% higher than last month at 7.3% but when adjusted for the government shutdown that plagued the first half of the month of October the rate would have been 7.0%. (F.Y.I.: the surveys that underlie the unemployment and jobs reports are separate items.)
Feeder cattle futures were higher as well, but followed a separate path. Feeders trended higher throughout the week before slipping on Friday. This was largely the inverse of the corn market which is currently the dominant indicator of feeder price movements. Corn futures were drifting lower throughout the week on the continued news of better yields across the U.S. and decent forecasts for harvest over the next fews days. Markets were also pricing in pre-report expectations of a larger carry-over to be revealed in Friday’s supply and demand report. The report did show an increased yield (160 bushels per acre compared to 155 in September but not too far off from pre-report expectations were 159). However, harvested acres were lowered just a bit and corn demand was increased which offset the higher yield and pulled ending stocks below expectations. As a result, corn futures surged Friday which hampered feeder prices.
Wholesale boxed beef began leveling off late last week and the sentiment remained this week. Choice beef averaged $204.47, down $0.09. Select averaged $189.99, up $1.00.
Note: Unless otherwise noted, all cattle and beef prices are quoted in dollars per hundredweight and corn prices are quoted in dollars per bushel.