Higher Corn, Lower Fed Cattle Futures Equals Lower Feeder Futures
USDA market reporters are back on the job. It will take some time for them to fill-in missing data.
USDA has announced that the October Cattle on Feed report, which was scheduled for today, has been postponed until October 31. The monthly Cold Storage, Livestock Slaughter, and Chicken and Eggs reports will also be released on October 31. The October Crop Production and WASDE reports have been cancelled. The next WASDE is scheduled for November 8.
Cargill has announced that next summer they will close their 62,000 head capacity feedlot in Lockney, Texas. They blamed the closure on reduced cattle numbers in the region due to extended drought.
Packer purchases of slaughter steers on Thursday averaged $129.39/cwt of live weight. That is up $5.08 compared to the USDA report for the last week of September. Steers priced on a dressed weight basis averaged $203.58/cwt of carcass weight, up $8.34 from late September.
Boxed beef cutout value for choice carcasses was $195.41/cwt this morning. Select carcass boxed beef value averaged $179.99. The $15.42 spread between choice and select is an indication of good beef demand.
Missouri feeder cattle auction prices were steady to $5 higher this week. Prices for medium and large frame #1 steers were: 400-450# $175-$224, 450-500# $170-$214, 500-550# $165-$201, 550-600# $160-$191.50, 600-650# $154-$184, 650-700# $147-$181, 700-750# $147-$176.50, 750-800# $150-$173.75, 800-900# $144-$171.75, and 900-1000# $143-$154.85/cwt.
The October live cattle futures contract closed at $129.87/cwt today, up $1.07 from last week's close. December fed cattle settled at $132.02, down 45 cents for the week. February cattle closed at $133.87/cwt and April at $134.77/cwt.
The December corn futures contract ended the week at $4.415/bushel, down 5 cents for the week. March corn settled at $4.54/bu down 0.5 cent from the previous Friday. May corn futures ended the week at $4.62/bushel.
Higher corn prices and lower fed cattle futures combined for lower feeder cattle futures. The October feeder cattle futures contract ended the week at $166.07/cwt, down $1.40 from the previous Friday. November feeder cattle settled at $166.85, down $2.42 for the week. The January feeder contract ended the week at $166.60/cwt.∆
DR. RON PLAIN AND DR. SCOTT BROWN: Agricultural Economists, University of Missouri