The week’s initial fundamentals supported a steady market, but as the financial instability continued to leak into the futures—packers seized their opportunity.
A struggling futures market and a $1 cwt lower bid incentivized trade Wednesday. The South was the first to go at $164 per cwt. It did not take long for feedyard owners to capture the positive basis and the trade was on. The weakness stretched into the North, where at least two major packers were buying at $164 per cwt. The East was the last to react and would have more of a trickle trade into the end of the week. The dressed trade was primarily $264 cwt and $165-166 cwt live.
Cattle on Feed Report out Friday, nothing out of expectations to report. It confirms the tighter supplies ahead. Placements moved South with the weather implications in the North.
Looking ahead, National Direct number Friday reports 75,000 head trading at mostly $1 lower. Packers added roughly 12,000 more head than the previous week. They do not want to lose inventory, as we work forward. The last of the yearlings are being offered and it will be a long few months before the calves are ready. Packers will begin to stretch to keep their needs met.
A native of Torrington, WY, Brodie Mackey joined Consolidated Beef Producers in the spring of 2013 after earning his B.S. from the University of Nebraska-Lincoln. Brodie’s focus at CBP includes customer development, cattle marketing and evaluation in Nebraska, Northeast Colorado, South Dakota and Wyoming. For more about Consolidated Beef Producers visit here.
