Market News

Cattle trade at lower prices

USDA Mandatory reported cattle trading was light in the Texas Panhandle and Kansas on Wednesday on light to moderate demand. Compared to last week, live sales were 2.00 to 3.00 lower in Texas, and 1.00 to 3.00 lower in Kansas, at 122.00. Trading and demand was moderate in Western Nebraska with live sales 1.50 to 3.00 lower at 121.50 to 122.00. Trade remained inactive in Eastern and Central Nebraska. Trading and demand was moderate in Colorado with live sales .50 to mostly 1.00 lower from 122.00 to 122.50. The cattle slaughter was estimated at 123,000 head, 1,000 less than last week, but 6,000 more than a year ago.

Boxed beef cutout values were lower on moderate demand and moderate to heavy offerings. Choice boxed beef was down .81 at 189.78, and select was 1.00 lower at 182.90.

Live cattle contracts settled 20 points higher to 50 points lower on the Chicago Mercantile Exchange on Wednesday.  Futures traded moderately to sharply lower for much of the session on growing concerns about the ability to push boxed beef values higher and grow overall beef demand over the near term. Selling pressure ran out of gas near midday allowing contracts to move off session lows and drawing some buyers back into the market. February settled .05 higher at 125.77 and April was down .02 at 130.45.

Feeder cattle ended the session 15 to 75 points higher with only spot January in the red. Support came from pressure in the corn futures market but gains were paired in the nearby contracts by the weakness in the live pit, and the uncertainty of beef demand. January settled .20 lower at 144.20, and March was up .15 at 147.15.

Lean hogs ended the session mostly lower with the deferred contracts pressured by the USDA cold storage report showing that pork supplies in freezers was up sharply from a year ago. The underlying uncertainty of pork demand through the second and third quarters of the year kept traders on the defensive. February settle.27 higher at 85.97, but April was down .27 at 88.00.

There was slow market activity with light demand in the direct hog trade on Wednesday. Barrows and gilts in the Iowa/Minnesota direct trade closed 1.53 higher at 87.67 on a carcass basis, the West was up 1.48 at 87.08, and the East was .48 higher at 81.48. Missouri direct base carcass meat price closed steady from 77.00 to 78.00. Terminal hogs were fully steady from 55.00 to 58.00.

Pork trading was moderate, with light to moderate demand and offerings on retail cuts. Pork carcass cutout value was .22 higher at 85.08.

Frozen pork supplies as of Dec. 31 were down only 1% from the previous month, the trade was betting on a 5-6% cut. Furthermore, this late year stockpile exceeded Dec. 31, 2011 by 14%, the average trade guess was up 8-9%.

Wednesday’s hog kill at 426,000 head is 2,000 less than last week, but 2,000 more than last year.

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