Calves, Feeders Higher, Fed Cattle Steady
Cash fed cattle traded steady on the week, but further gains in the wholesale beef market gives cattle feeders the incentive to stick to higher asking prices in the short run.
Negotiated cash trading was called moderate in the North at $157 to $159 live and $252 dressed, steady with the previous week. Trade in the South was called moderate to active at $157 per cwt., also steady. Feeder cattle traded steady to $5 higher while calves traded $2 to $7 higher. Market cows sold from $2 to $6 higher.
Estimated weekly cattle slaughter was 563,000 head compared to 619,479 head a year ago.
Wholesale beef prices moved modestly higher during the week, but are $20 per cwt. higher than two weeks ago. Choice boxed beef closed Friday at $283.23 per cwt., $1.25 per cwt. higher than the previous Friday. Select boxed beef traded Friday at $260.40 per cwt., up $9.70 for the week.
At the CME, Live cattle futures declined Friday, with nearby February live cattle dipping 57.5 cents to $156.775. That marked a weekly slide of $1.125. Most-active March feeders fell 90 cents to $185.65, which represented a weekly decline of 57.5 cents.
Tight supplies of market-ready feedlot cattle will likely tighten further on a seasonal basis through January and much of February. When combined with improved beef demand from grocers and consumers in the wake of the holiday season, this often powers the cash cattle market higher during the early portion of the year.
Having Choice beef cutout move above last year’s top, as well as the $300 level, seems quite likely in the weeks just ahead, so short-term price prospects still look favorable. The futures market, specifically the discount built into the nearby February contract, is giving producers no reason to hold back cattle.
