Compared to last week, calves in a light test and yearlings sold firm to 5.00 higher, with many auctions that were closed during Memorial Day quoted a full 10.00 higher than two weeks ago. Receipts continue to be dominated by heavy yearlings which is fortunate since that is exactly where the best demand exists. Buyer interest still remains good for calves, best on calves under 550 lbs as in many cases localized demand is readily absorbing lightweight calves. In the Southeast calves traded mostly 2.00-5.00 higher.
There remain plenty of bearish attitudes lurking about as Boxed-beef values have moved sharply lower and cries of weak beef demand remains in circulation. Boxed-beef values have come back down to earth since Memorial Weekend, as seasonal prices are trending lower but seasonally on target. Boxed beef values will have to soften to stimulate buying interest from retailers. After topping out at 265.59 on May 19th, Choice product has since steadily declined and closed Friday 3.83 lower for the day at 244.65. A seasonal decline in fed cattle prices so far has not been accompanying the boxed-beef trade, with most trade still hovering around the 158.00-160.00 level that still continues to capture trade as of last Friday.
Bids and asking prices on this Friday remain far apart as neither packer or seller are willing to meet in the middle. Some good news for the Livestock sector came from the foodservice business as the latest data from the Restaurant Performance Index released May 29th posted moderate growth in April. The RPI stood at 102.7 up 0.5 percent from March which indicates a continued optimistic outlook among restaurant operators.
April represented the 26th consecutive month in which the RPI stood above 100; a good indication of expansion as values under 100 indicate contraction. There was no contraction for yearling prices this week as at the Kingsville Livestock Auction in Kingsville, MO on Tuesday sold 177 head of 800-850 lb steers averaging 832 lbs sold for a weighted average price of 236.85, topping out at 240.60. At the Blue Grass Stockyards in Lexington, KY on Tuesday sold a part load of yearlings weighing 851 lbs for 218.50 and a pot load weighing 887 lbs traded for 214.25.
Live cattle and feeder cattle futures are finding some choppy trade but keep doing better than boxed-beef values and limited to lower cash bids. The U.S. Jobs report was released Friday morning with US employers ramping up hiring last month adding 280,000 jobs in May well above expectations as the Labor market appears to be picking up momentum after slowing in the early months of 2015.
Wheat harvest is starting to get underway and will be making its way up through the Southern Plains which will limit the already abbreviated auction schedules. The nation’s corn crop is within 5 percent of being completely planted as 95 percent is in the ground with 84 percent emerged and 74 percent rated good to excellent. Auction volume included 52 percent weighing over 600 lbs and 39 percent heifers.