Cash Fed Cattle Higher, COF Data Friendly

Fed cattle and feeders sold higher ( OSU )

Cash fed cattle traded in the South mostly $1 higher at $120 live. Cattle traded in the North at $119 to $120 live and $190 dressed, steady to $1 higher.

USDA’s February 1 cattle on feed report was called mildly friendly compared to pre-report expectations. USDA counted 11.928 million head on feed in 1,000-plus feedlots, up 252,000 head or 2.2% from year ago. January placements declined 0.6% from 2019, while marketing rose 1.1%.

A weight breakdown of calves placed into feedlots last month shows lightweights (under 600 lbs.) up 2.6%, 6-weights up 2.2%, 7-weights down 3.6%, 8-weights down 4.1%, 9-weights up 5.0% and heavyweights (1,000-plus lbs.) steady with year-ago levels. Kansas feedlots placed 60,000 head more cattle in January than they did last year, while Texas feedyards placed 50,000 head fewer on feed.

While analysts called the report friendly, the data was not strong enough to be called bullish.

Steers and heifers sold at auction $2 to $6 higher, with some auctions quoting double digit gains in the Plains states.

“New-found optimism and warmer weather brought out buyers ready to take on grazing calves,” AMS reporters said. “Many auction reports made note of the condition of cattle and alluded that buyers were hoping for compensatory gain as soon as the cattle got off the truck.

While the market was active, greatest demand was for light-fleshed cattle under 600 pounds.

April cattle were down 90 cents on Friday to settle at $118.15 and down $2.075 for the week. April feeder cattle fell 42.5 cents to $142.10 on Friday but up 72.5 cents this week.

Cattle Slaughter under federal inspection is estimated at 628,000 for the week, 8,000 more than last week and 47,000 more than a year ago.

The Choice beef cutout closed $3 lower at $205.09, while Select was $4.01 lower at $201.70. The Choice/Select spread was $3.39.