Compared to last week, lower prices continued in the feeder cattle markets as feeder cattle and calves traded mostly $5.00-10.00 lower. Auction receipts were mostly light this week due to the hot temperatures and high humidity causing high heat index levels of near and over 110 degrees in areas across the Midwest and Southern Plains. Receipts for the most part continue to be dominated by yearling cattle over 700 lbs which is where the best demand exists at this time.
Demand remains moderate to good with best demand in the Northern Plains for yearlings as on Tuesday in Philip, S.D. at the Philip Livestock Auction sold near 3200 head of mostly yearling cattle with near 300 head of steers weighing between 850-900 lbs averaging 884 lbs sold with a weighted average price of $212.74. Demand was very good in Kearney, Neb. at the Huss Platte Valley Livestock Auction on Wednesday where 228 head of yearling steers averaging 925 lbs sold with a weighted average price of $215.48. A number of good strings of calves and yearlings this week were on offer at the Superior Video Royale sale broadcast on Monday from Ft. Worth, Texas then moving to Winnemucca, Nev. on Wednesday selling 137,000 head of cattle with the final report to be issued on Monday.
Last week and into Monday of this week Live Cattle and Feeder Cattle contracts took a pounding as long term bulls were nowhere to be found. The cattle complex did finally pull off a positive day of trading on Tuesday with triple-digit gains that extended with modest gains into Wednesday. But, the sometimes upside potential has no sense of urgency to rally much higher anytime soon.
Last week USDA issued on Friday its Cattle on Feed Report and the July 1 Cattle Inventory Report all had lots of information and data but little effect on market impact. There were few surprises and no really bullish news to report. Pretty much everybody in the industry knows expansion is well underway, but it will be over a year before many of the heifers retained will calve.
Lower corn market this week is having little effect in Feeder Cattle contracts so far as the fed cattle market has plenty of red ink flowing as the fed cattle market tries to carve out its summer low.
Boxed-beef prices are at their lowest levels since last June and have this week gained some footing hopefully finding their summer low. Choice boxed-beef closed .09 cents lower on Friday at $233.25. Retailers still seem to be a bit lax in buying product and slow to stimulate consumer buying. A strong U.S. dollar and weaker export demand from the Pacific Rim countries especially Hong Kong and Japan have beef exports struggling; also beef exports to Mexico have been laboring as well.
Competing meat prices are strikingly lower than year ago levels as pork prices hit their all-time highs last summer during the PEDv outbreak and chicken prices were also stronger last year. The attitudes of many in the commodity markets who are trading is getting to be a little bitter and even irritable from grains, precious metals, energy markets, and the Stock Market all rocking back on their heels and struggling with selling interest in the market place at this time.
Corn crop is now rated 70 percent good to excellent up 1 percent from last week, with 78 percent in the silking stage. Corn prices have moved lower this week as favorable weather is in the forecast for the next week. Auction volume included 50 percent weighing over 600 lbs and 37 percent heifers.