Substantial wholesale beef price declines and lower retail demand pulled cash cattle prices lower last week as trade fell by more than a dollar, erasing all of the previous week’s gains. Cash trade has decreased in three of the past four weeks, losing $1.61 per cwt in that time. Trade was impacted by sputtering beef demand ahead of the Thanksgiving holiday and continued negative packer profit margins, but a recovery is anticipated this week.
Although trade has moved lower in recent weeks, our Monday Market Sentiment panel expects trade to pick up in the shortened week, forecasting an increase of 51 cents to $131.10 per cwt.
The Monday Market Sentiment is a forecast of the upcoming weekly cash trade (5-Area weighted average price) prices reported by the USDA. This week’s average cash price declined by $1.05 per cwt compared to the previous week. Last week the USDA announced that cash trade for the week ending November 22 was $130.59 per cwt.
Cash trade is expected to remain at least steady with last week, according to Reuters with more recovery in December. More cattle are available this week and packers may be more active in order to increase production following the holiday. Beef prices bounced back Monday which will support packer margins and further encourage them to bid aggressively.
Each week the Cattle Trader Center, on behalf of Vance Publishing, awards a $100 gift certificate from Cabela's to the industry leader whose forecast comes closest to the 5-Area cash trade number reported by the USDA. The most recent winner was Wayne Lee, Cattle Empire.