Cattle Futures Soar as Traders Anticipate Robust Cash Market

The cattle futures market experienced a significant surge on Wednesday, with traders positioning themselves ahead of this week's anticipated robust cash cattle trade. The December live cattle contract jumped $2.52 to $187.70, while the February contract rose $2.22 to $188.40. In the feeder cattle market, the November contract gained $3.87 to $248.55, and the January contract climbed $3.62to $242.07.

Bullish Sentiment Grips the Cattle Futures Market

Quiet Cash Cattle Trade Precedes Potential Flurry of Activity

Direct cash cattle trade remained relatively quiet on Wednesday afternoon, with only a few early asking prices reported in the South at $187. However, bids remained elusive, and significant trade volume could be delayed for another day or two. Traders are closely monitoring the cash market, anticipating a potential surge in activity later in the week.

Feeder Cattle Auction Showcases Quality Yearlings and New Crop Calves

At the Creston Livestock auction in Iowa, a diverse offering of feeder cattle was available, including many load lots of quality yearling steers and heifers coming off grass, as well as numerous smaller packages of reputation new crop calves, many of which were double vaccinated and fresh off the cow. USDA reported that demand was very good for the moderate offering, and the trade was very active.

Boxed Beef Prices Decline, but Spreads Remain Elevated

Boxed beef cutout values closed lower on Wednesday, with Choice down $0.36 at $299.81 and Select down $1.37 at $283.93. The Choice-Select spread remained elevated at $15.88, reflecting the continued strong demand for higher-quality beef products.

Cattle Slaughter Ticks Higher, but Remains Below Year-Ago Levels

Estimated cattle slaughter for the week was 124,000 head, up 4,000 from the previous week but still down more than 2,500 compared to the same period last year. The industry continues to navigate supply chain challenges and labor shortages, which have impacted overall slaughter capacity.

Hog Futures Mixed as Traders Adjust Spreads

In the hog futures market, prices were mixed, with traders largely shrugging off the bearish cash and wholesale business during the session. The December contract was up $2.15 at $76.75, while the February contract gained $1.57 to $80.15 as traders adjusted spreads.

Cash Hog Prices Soften, but Wholesale Pork Remains Elevated

Cash hog prices were steady to sharply lower, with light closing negotiated numbers at the major direct markets. It appears that most buyers have the needed near-term numbers in hand after the higher trade earlier in the week. The USDA's weekly export sales numbers, due out on Thursday morning, will be closely watched for any potential impact on the pork market.

Hog Slaughter Remains Steady, but Weights Continue to Climb

Estimated hog slaughter for the week was 486,000 head, even with the previous week and up more than 1,500 compared to the same period last year. However, the average barrow and gilt weight in the Iowa/Southern Minnesota/South Dakota reporting area last week was 284.2 pounds, up eight-tenths from the previous week and 2.3 pounds from last year, reflecting the ongoing challenge of managing hog weights in the face of supply chain disruptions.