Cattle feeders knew selling ahead of a short holiday week would create additional challenges for cash cattle prices and the ability to move cattle. Unfortunately, trade volumes met low expectations.
The downward spiral in the cash cattle trade is ongoing as the number of market-ready cattle continues to grow. Showlists are already overburdened to date, and market-ready cattle add to the list weekly.
Packers continued to keep the trading range wide last week while lowering their bids. Many feeders passed on bids they believe are not reflective of current cattle values.
Cash prices are steady for now, but Tyson turned down some cattle last week that they thought are now too big, which is a huge concern other feeders may encounter in the near future.
Cash cattle prices traded higher last week, and for the first time in several weeks most of the major beef packing plants should be up and running this week, though not full-throttle.
The South saw another wide trading range last week as prices ranged from $95 to $115 per cwt. for cash fed cattle with just two packers active in the negotiated cash market.
Light cash trade continued with a wide price range. Two of the major packers were active in the market, with one actively making an effort to support prices.
Cash cattle prices were under pressure as packer demand was soft in both the North and South last week. Numbers of ready cattle will grow in the coming weeks.
Can prices gained in last week's fed cattle rally be maintained? There is some concern that the lack of cattle moving in the cash trade is starting to back cattle up and hurt hard-earned gains.
Packer margin is significant. However, why is packer profitability the only focus, and we are not as outraged about the other “elephant in the room” issue within our market?
Cattle producers continued to be in the crosshairs of the chaos in the global markets. In the south producers found $110 was the best trade they could get, with cattle trading as low as $105 by the end of last week.
After several days of up and downs in CME futures prices, cattle feeders saw their chances of getting back to steady slip away on Thursday as the board sold off.
If there was ever a question of how much outside influence there is on the cattle market it was completely exposed this past week with fears over the coronavirus growing.
Last Monday the cattle market felt the same negativity as all other markets with the uncertainty of what may happen to global trade due to the effects of the coronavirus.
While the CME futures was under distress last week, hedgers were able to receive the best basis they have seen for several weeks and the result was a steady cash market.
Packers were aggressive in obtaining inventory to start the new year, and the result was a cash cattle market that gained $2 in both the north and south.
Last week was one of the last chances for cattle feeders to push the market up to the $120-plus price range. Three packers were in the market to buy cattle by feeders chose to settle for steady money.
The cash cattle market continues to be the best broken-record producers ever heard of late as three of the four major packer participated in the live trade last week.
Packers were still hunting front end cattle late last Friday, knowing that feeders would have their sights set on a higher December board for the trade this week.
Cash cattle markets backed up last week from a steady upward movement due to a boiler explosion, and the three days of unexpected downtime at Cargill’s Dodge City plant.
The $1 threshold seemed to be a sticking point for cattle feeders last week, and many held firm on Friday which could prove to give cash prices a needed boost.
Packers were hesitant to offer a bid on cattle early last week, and after a $5 decline, feeders still have many unanswered questions about the impact of harvest capacity.
The fluctuation in the cash price in this trade seemed to be mostly dependent on the location of the cattle, with prices ranging from $114-$116, with dressed trade at $182-$185.