Cattle Rally Runaway, Auction Receipts Soft
Cash prices charged higher in feedyard country this week, leaving CME futures in the dust.
Cash fed cattle traded $6 to $15 per cwt. higher this week. Trade in the South was mostly $119 to $120, while trade in the North was $118 to $120 and $185 to $190 dressed. Cattle Slaughter under federal inspection was estimated at 676,000 for the week, 23,000 more than last week and 57,000 more than a year ago.
June live cattle futures closed down $4.125 at $89.425 Friday. For the week the market lost a dime, after at one point being up by around $10 in intra-day futures trading Wednesday. May feeder cattle futures closed down their $4.50 limit at $120.925. For the week, May feeders gained $2.675.
Steers and heifers sold $8 to $15 higher at auction, rebounding and recovering most of the losses incurred last week. Auction volume was 87,200 head, up from last week’s 59,000 head, but down 66% from last year’s 258,700 head.
“The supply of feeders was light again this week and not near what is considered normal for this time of year,” AMS reporters said. “Some ranchers saw an opportunity to market cattle with higher moves (3 of 4 days being limit up moves) in CME Futures from Thursday last week to Tuesday of this week. The sales that did occur in the Plains states consisted of several loads of cattle that ranchers really wanted to move a week or two earlier, but had not occurred due to the global volatility of financial markets.”
Demand for feeders was called good to very good. Slaughter cow prices skyrocketed early this week at auctions nationwide. Demand for boneless lean ground beef continued to move higher as cow plants needed product to move through the marketing chain this week to fill ground beef orders place by retailers.
On Monday NASS reported total red meat supplies in freezers were up 3% from the previous month and up 5% from last year. Total pounds of beef in freezers were up 1% from the previous month and up 4% from last year.
Friday’s Choice beef cutout was $1.64 per cwt. lower at $252.11, with Select $1.44 higher at $241.61. The Choice/Select spread was $10.50.
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