Live cattle futures have been very volatile the past few weeks with prices making limit moves higher and lower during several of the recent trading sessions. The December futures contract fell to a new low at 125.00 cents/lb. this week, but held above the nearby continuation chart low from early October at 120.20 and bounced back above 130.00. Similarly, February futures posted a new low at 127.70 cents/lb before rebounding above 133.00.
No cash trade has been reported. The five-area cash average last week was $127.04, down $3.37 from the previous week. In Nebraska, cattle were down about $2.00 while losses in the southern Plains were $4 to $5/cwt. This realigns prices from the week prior, when Nebraska losses far exceeded those in the southern Plains.
Beef prices kept sliding, with both the Choice and Select cutouts down $4 to $6/cwt for the week. Beef demand is expected to improve as retailers begin to focus on post-Thanksgiving features. However, large supplies of pork and poultry will be a limiting factor for the beef market.
Steer carcass weights have declined from their 930-pound October peak, indicating that feedlots are making some progress working through the backlog of market ready cattle.
USDA will release the Cattle on Feed report on Friday. Trade expectations are for October placements to fall 4% from a year ago. Marketings could also drop 4%, mostly due to one less marketing day this year compared to 2014. Cattle on feed as of Nov. 1 are expected to rise 2%.