Live Cattle Futures Show Strong Gains Amid Changes in Cattle Trade
Recent Developments in Cattle Futures and Market Trends
Live cattle futures experienced impressive gains on Friday, with prices rising by 22 cents to $1.175. The December contracts led the charge, resulting in a weekly increase of $3.825. In the cash market, trades concluded last week at prices between $186 and $188, with the majority settling at $187. The Central Stockyards Fed Cattle Exchange’s online auction recorded sales of 587 out of 2,344 heads listed, with sales prices ranging from $187 to $187.50 live. Additional bids reached $187 and $189 using their BidTheGrid™ method. Feeder cattle also saw gains, climbing 625 cents to $1.30 on Friday, with January contracts up $7.07 for the week. The CME Feeder Cattle Index rose by 27 cents, reaching $254.54 as of November 21.
In a significant health alert, the Chief Veterinarian Officer in Mexico informed the USDA about a case of New World Screwworm found in a southern Mexican border state. As a precautionary measure, APHIS has implemented stricter import regulations on animal products from Mexico, which is expected to restrict feeder cattle imports from that region.
The Friday afternoon Cattle on Feed report revealed that October placements totaled 2.286 million head, reflecting a 5.35% increase compared to the previous year, and surpassing expectations of a 3.8% rise. Marketing numbers for October also rose by 4.65%, reaching 1.845 million head, slightly below the 5.2% expected increase. Notably, the November 1 on-feed inventory hit a record high for this month at 11.986 million head, marking a 0.25% increase from last year, contrary to the anticipated 0.1% decrease.
Data from the Commitment of Traders indicated that speculative funds increased their net long positions in live cattle futures and options by 5,098 contracts, reaching a total of 108,415 contracts as of November 19. Additionally, managed money in feeder cattle grew their net long by 1,608 contracts, totaling 13,667 contracts as of Tuesday.
In the USDA’s Friday afternoon report, wholesale boxed beef prices showed mixed results. Choice boxes increased by 62 cents to $307.41 per cwt, while Select boxes dropped 85 cents to $272.07, widening the Chc/Sel spread to $35.34. The USDA estimated last week’s federally inspected cattle slaughter at 631,000 head through Saturday, which is 25,000 higher than the previous week and significantly above the same week last year, due to Thanksgiving being a week later this year.
Live Cattle Prices:
Dec 24 Live Cattle closed at $186.775, up $1.175.
Feb 25 Live Cattle closed at $188.200, up $0.775.
Apr 25 Live Cattle closed at $189.950, up $0.425.
Feeder Cattle Prices:
Jan 25 Feeder Cattle closed at $254.300, up $0.850.
Mar 25 Feeder Cattle closed at $253.125, up $1.025.
Apr 25 Feeder Cattle closed at $254.350, up $1.225.
On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
