Cattle: Stuck On Steady
The calendar still read January the last time cattle prices saw an advance. Cattle feeders then – and now – believed they were gaining market leverage and demand might soon spike. Instead, cash cattle prices finished a sixth consecutive week trading at steady on Friday.
Moderate trade occurred in the South at $114 per cwt., with moderate to active trade in the North at $113 to $114 live and $178 to mostly $180 dressed. The sideways trade comes with some positives: cattle weights are in decline and the aggressive kill schedules support ideas of tighter second quarter market-ready supplies.
Weekly packer plant capacity utilization is running 2% to 3% lower than last year due to social distancing of workers, which likely accounts for much of the loss in market leverage for feeders. Beef demand, however, remains strong and packers remain enticed to keep plants humming as margins are large.
April live cattle futures closed the day up $0.475 at $119.00 and for the week lost 2 1/2 cents. May feeder cattle futures hit a new contract high today and closed up $1.975 at $148.375. For the week, May feeders gained $3.225.
June live cattle futures have trended up the past two weeks and are not far below the contract high scored in February. The cattle market bulls are hoping for a seasonal recovery in the cash cattle market soon.
Estimated cattle slaughter this week is 647,000 head compared to 640,690 head last year. The total year-to-date was 6.7474 million head, 3.1% below last year.
Boxed beef cutout values are trending lower, with Choice boxed beef closing Friday at $227.02 per cwt., down $6.11 from the previous week. Select boxed beef closed Friday at $221.45 per cwt., up $0.72 from the previous week.
Feeder cattle prices were called $1 to $3 higher.
