BOLO for Fed Cattle: Packers Need Inventory, Prices Steady to Higher
If there was an inventory-wide BOLO system (be on the lookout), packers would have used it this week. Supplies of market-ready cattle are tight enough that post-July 4th trades in the North gained $2 per cwt., a contra-seasonal advance. Northern feeders sold cattle at $182 to $185 per cwt. Prices in the South occurred at $178 per cwt., which is mostly $1 lower.
Feeder cattle traded steady to $4 per cwt. higher and calves traded steady to 42 higher.
Wholesale beef prices continued trending lower. Choice boxed beef closed Friday at $316.90 per cwt., down $10.82 for the week. Select boxed beef closed Friday at $285.63 per cwt., down $8 per cwt. for the week.
Cattle futures rebounded sharply Friday, with August live cattle futures jumping $2.425 to $177.00 and August feeders leaping $3.15 to $245.425. These closing quotes represented weekly losses of 17.5 cents and $2.15, respectively.
Cattle traders apparently expected the early-summer slide in fed cattle values to continue this week. Early-week cash trading pointed in that direction, registering modest week-to-week losses through Wednesday. However, trading in the more-tightly supplied northern states began yesterday, with the indicated gains pulling the four-day average up to $180.70, up 29 cents from the comparable week-prior result.
Traders believe those gains and today’s bullish futures reaction will almost surely push the full-week average even higher. Analysts suspect cash prices will edge upward again next week, especially if they are correct in thinking active grocer buying for beef features the first weekend in August will also boost wholesale prices. That actually might be required to power fresh cattle gains, since choice and select values fell so sharply this week.
