October’s momentum in the cash market ended as beef prices moved lower toward the end of November. The beef-cutout value dropped below $200 per hundredweight, leading packers to place fewer bids while their profit margins remain in the red. Consumer beef demand typically takes a step back at the end of the fall season and slowly returns ahead of the new year. Limited cattle supplies, which are expected to contract even more during herd rebuilding efforts, will prevent cash trade from losing considerable ground in the months ahead.
Each week Cattle Trader Center (cattletradercenter.com), sponsored by Merck Animal Health, solicits entries for Monday Market Sentiment (MMS), an online contest where participants are asked to pick the weekly market price for fed cattle. The entry closest to USDA’s weekly five-area weighted reported fed-cattle prices wins a $100 Cabela’s gift card.
Cash trade reached record sale prices at the end of October as USDA reports returned following the government shutdown, but the market ran out of steam with limited offerings at lower prices. Losses in the first week caught our panel off guard as cash trade fell 18 cents in the week ending Nov. 1. Those losses continued the following week, down another 99 cents and almost a full dollar lower than the MMS weekly forecast. As the panel anticipated, cash trade improved in the third week with the five-area average increasing by 61 cents to $131.64. Losses in the fourth week were more drastic than projected as cash trade moved more than a dollar lower to $130.59 per hundredweight.
Weekly winners of the MMS contest were:
November 1 — Tom Brink, Platte Beach Capital
November 8 — Steve Lakin, Lakin Feedyard
November 15 — Marshall Jensen, Snake River
November 22 — Wayne Lee, Cattle Empire
Contest entries may be submitted between noon and midnight on Mondays by emailing your cash-market price quote (live FOB steers and heifers combined price per hundredweight) to firstname.lastname@example.org with “Monday Market Sentiment” in the subject line. For more information and official rules, visit cattletradercenter.com.