Mackey: Feeders Will Seek to Regain Leverage

Harvest finished the week at 635,000 head after the Saturday kill was added.  Harvest for the year has been 4.7% off last year’s pace and there has been continued talk of additional Saturdays at multiple plants as we work into the holidays.  Perhaps that indicates improved margins for packers and cattle feeders are hopeful this leads to more buyers entering the market with larger purchasing needs.

From North to South last week’s market was $3 to $4 lower from the previous week.  Another round of falling futures provoked another dose of lower bids, $171 per cwt. live and $271 per cwt. dressed would trade the cattle early; however, packers were sure to not hang that bid out too long and get covered up. Another round of sales would take place $1 lower at $170 live and $270 dressed.  Friday’s numbers have 4,200 fewer cattle trading when compared to a week ago. 

At this point the market has made its typical 11% retreat from high to low.  Many will now attempt to reverse the trend of this market.  Early comments of cattle feeders handling some of their smallest lists of the year and coupled with the additional Saturdays—now is as good of time as any to try and gain back some leverage.