Cattle Futures Surge Ahead of Crucial USDA Report

The cattle futures market has seen a significant uptick in activity, with both live and feeder cattle contracts closing higher ahead of the highly anticipated USDA Cattle on Feed report. Traders and industry analysts are closely monitoring the market, anticipating that the upcoming data release will provide crucial insights into the state of the beef industry.

Bullish Sentiment Prevails as Traders Brace for USDA Insights

Cattle Futures Climb Ahead of USDA Report

At the Chicago Mercantile Exchange, the live and feeder cattle futures contracts have experienced a surge in prices, with December live cattle closing $1.05 higher at $188.05 and December feeder cattle closing $1.20 higher at $188.82. The November feeder cattle contract also saw a significant increase, closing $2.32 higher at $248.92, while the January feeder cattle contract closed $1.80 higher at $246.05. This bullish sentiment reflects the market's anticipation of the USDA's Cattle on Feed report, which is scheduled for release on Friday afternoon.

Direct Cash Cattle Trade Remains Quiet

The direct cash cattle trade activity has been relatively quiet on Tuesday, which is not uncommon for this time of the week. Bids and asking prices have yet to be established, and industry participants are likely holding out for significant trade volume until later in the week, potentially Thursday or Friday, especially in light of the upcoming USDA report.

Regional Feeder Cattle Market Sees Mixed Trends

At the Callaway Livestock Center in Missouri, the feeder cattle market has seen a mixed performance. Steer calves under 700 pounds and heifer calves under 600 pounds were lightly tested, with several groups of 500-to-550-pound steers selling $5 to $7 lower and several groups of 550-to-600-pound heifers selling steady to $5 lower. The USDA noted that the quality of the offering was not as strong as the previous week. Demand was moderate to good on a moderate supply, with receipts down on both the week and the year. The feeder supply included 52% steers, and 62% of the offering was over 600 pounds. Medium and Large 1 feeder steers weighing 768 to 791 pounds brought $252.50 to $254, while feeder steers weighing 866 to 890 pounds brought $242.75 to $246.25. Medium and Large 1 feeder heifers weighing 558 to 594 pounds brought $268 to $271, and feeder heifers weighing 609 to 626 pounds brought $271.25 to $276.10.

Boxed Beef Prices Show Mixed Trends

The boxed beef market closed with mixed results, reflecting light to moderate demand for the moderate offerings. Choice boxed beef closed $1.10 higher at $323.96, while Select boxed beef closed $1.41 lower at $294.80, resulting in a Choice/Select spread of $29.16. The estimated cattle slaughter for the week was 123,000 head, down 2,000 on the week and more than 4,000 on the year.

Hog Futures and Cash Prices Climb

In the hog market, lean hog futures were mostly higher on spread trade, with December lean hogs closing $0.85 higher at $79.12 and February lean hogs closing $0.55 higher at $79.12. The cash hog market also closed higher, with a solid negotiated run. Processors have been more aggressive in their bidding to secure the necessary numbers, reflecting the strong global demand for U.S. pork, which is providing price support. However, the market continues to face some pressure from the uncertainty around long-term domestic demand and the ample supplies of market-ready hogs. Barrows and gilts at the National Daily Direct closed $1.89 higher, with a base range of $69 to $79 and a weighted average of $77.11.