The cattle market responded positively this week as all packers were in play in the cash market. A few cattle traded at $121 per cwt late Thursday afternoon in Kansas. However, the majority of the feeders held off until Friday when bids reached $124 in the south.
Most of the cattle traded in the north at $195-$197 per cwt dressed, $125-126 cash, with a handful said to have brought $128. The activity last week caused June futures to find some upward momentum, giving a little hope for what could come in the next couple of weeks.
Do we still have room for upward movement in the cash market? That is the question that will have to be answered in the next few weeks. The basis remains wide creating a great opportunity for May cattle that are currently hedged.
From all indications the cash show list in the south will remain lower until the end of the month. Packers could potentially find it challenging to obtain enough market ready cattle to meet their spring order demands.
Lower market-ready cattle numbers in both the north and south regions could continue to give feeders the leverage for higher prices for a few weeks. Feeders will need to take every advantage to push the market before more numbers arrive in late-May to early June.
One can hope during this time that the demand for beef stays robust, causing packers to depend more heavily on the live market.