Cattle Futures Surge on Robust Cash Trade

The cattle futures market experienced a significant uptick, driven by a stronger cash trade. Live and feeder cattle prices rose at the Chicago Mercantile Exchange, reflecting the positive momentum in the direct cattle business. The report delves into the details of the cash trade, auction market activity, and the overall state of the beef industry.

Bullish Signals Propel Cattle Futures Higher

Strengthening Cash Cattle Prices

The cash cattle trade saw a light to moderate round of activity on Thursday, with deals reported in Kansas at $184 to $185 live and in Texas at $185 live, marking a $2 increase from the previous week's weighted averages. Dressed deals in Nebraska were reported at $294, approximately $4 higher than the prior week's business. Additionally, a handful of live deals were reported in parts of Iowa on Wednesday, ranging from $184 to $186.

Robust Feeder Cattle Auction Prices

The Winter Livestock Auction in Kansas witnessed strong demand for feeder cattle, with prices moving significantly higher across various weight classes. Feeder steers under 500 pounds were $10 higher, while steers in the 500 to 750 pound range were $3 to $7 higher. Steers over 750 pounds saw gains of $5 to $9. Heifers also experienced notable price increases, with those under 500 pounds up $4, heifers in the 500 to 700 pound range $3 to $7 higher, and heifers over 700 pounds $2 to $6 higher. The USDA reported that demand was good to very good, with a heavy supply of feeder cattle. Receipts were up on both a weekly and yearly basis, with 59% of the offering comprising steers and 76% weighing over 600 pounds.

Boxed Beef Prices Decline Amid Light Demand

Despite the strength in the cash and futures markets, boxed beef prices closed lower on light demand for solid offerings. Choice beef was $1.80 lower at $296.37, while Select beef closed $0.91 lower at $282.37. The Choice-Select spread stood at $14.00.

Hog Futures Retreat Ahead of USDA Reports

In the hog market, lean hog futures ended the day mostly lower as traders anticipated the release of the USDA's Quarterly Hogs and Pigs and Cold Storage reports. October lean hogs closed $0.45 lower at $82.02, and December lean hogs closed $0.97 lower at $73.92.

Cash Hog Prices Climb on Stronger Demand

The cash hog market closed higher, with processors being more aggressive in their procurement efforts and bidding up prices. While the negotiated run was relatively small, the increased demand from processors led to higher cash hog prices. Export sales from the USDA showed a slight decline in pork sales this week, but overall global demand has remained strong. Concerns linger about the direction of domestic demand.

Pork Cutout Values Increase

Pork cutout values closed higher, up $0.54 at $94.64. Bellies, hams, ribs, and loins were all higher, while picnics and butts were lower. The estimated hog slaughter for the day was 486,000 head.