Cattle Market Weekly Audio Report for Sat., Oct 5, 2018

CME Feeder Cattle Index closes at highest level since last November.

Feeder cattle traded firm to $2 per cwt higher, according to the Agricultural Marketing Service (AMS). Calves sold unevenly steady with buyers discounting un-weaned and short-weaned types in some areas.

Week to week on Friday, other than narrowly mixed across the front half of the board, Feeder Cattle futures closed an average of 96 cents higher (40 cents to $1.50 higher).

The CME Feeder Cattle Index was at the highest level since last November on Thursday at $158.18.

“Numerous factors will affect the likelihood of a seasonal stocker calf price low in the next month,” says Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, in his weekly market comments. “Supplies will grow as feeder volumes increase to a seasonal peak by early to mid-November. With the larger 2018 calf crop, the fall run of calves is expected to exceed last year. However, demand for wheat pasture stockers may partially or totally offset increased stocker calf supplies.

“I really don’t expect much more increase in stocker prices but additional increases are possible in the next couple of weeks. As we move through October into November, feeder prices are likely to stabilize or perhaps move lower but the seasonal low may be quite muted. Recent purchase price increases have reduced the return potential for winter stockers, meaning that producers should carefully budget winter stockers to guide upcoming purchases. For cow-calf producers, recent calf price increases have added upwards of $50 per head to calf value in the past six weeks or so.”

Fed cattle prices hover

Negotiated cash fed cattle trade was mainly steady through late Friday afternoon at $110-$112 per cwt on a live basis and at $174-$175 in the beef. Trade remained undeveloped in the Southern Plains.

Live Cattle futures closed narrowly mixed, from an average of 32 cents lower toward the front of the board to an average of 24 cents higher.

“Packers continue to work in the black as slaughter rates remained aggressive and finished the week at 643,000 head,” say AMS analysts.

Wholesale beef values continued seasonally lower. Week to week, Choice boxed beef cutout value was 63 cents lower Friday afternoon at $203.25 per cwt. Select was $1.70 lower at $191.74.

Listen to Wes Ishmael's Cattle Market Weekly Audio Report every Saturday morning on the BEEF magazine website. This is your report for Saturday, Oct. 06, 2018.

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