Trey Freeman, Commodity Futures Dealer/Livestock Agent, Ever.Ag
The money marketplace for fed cattle continues to guide reside cattle futures, with probably the most lively August contract promoting at a steep $10-per-hundredweight low cost to final week’s 5-Space Common Steer Worth of $192.55. June futures, set to run out subsequent Friday, additionally stay at a reduction, at present $6 per hundredweight below the 5-Space.
The continued lack of enthusiasm in reside cattle futures might be attributed to stronger-than-expected beef manufacturing noticed all through 2024. Markets can also be involved about softer-than-normal beef demand for the interval from July 4 to Labor Day weekend, amid elevated retail costs.
Beef manufacturing is down just one.5% year-to-date versus 2023, due largely to stubbornly excessive dressed cattle weights. Final week, dressed weights for steers had been reported at 924 kilos, 4 kilos increased than the earlier week, and 37 kilos above final yr. Low-cost feed costs have allowed cattle feeders to feed longer and seize higher margins. Friday’s Cattle on Feed report is anticipated to point out a document variety of whole cattle on feed of 120 days or extra.
Final week, USDA reported the common value in Might for all-fresh retail beef at $7.96 per pound, up from $7.50 a yr in the past. Common retail costs have elevated from month-to-month in 15 of the final 18 months.
Selection beef cutout averaged $318.29 per hundredweight final week, in comparison with the all-time pricing for a similar week final yr at $339.93.
Feeder cattle futures have traded in a $16-per-hundredweight vary over the past 60 days. Analysts are intently monitoring corn futures because the climate market performs a heavy position in corn and soybean value motion this time of yr. The June Acreage report, set to be launched subsequent Friday, would be the catalyst to push feeder futures out of the rangebound commerce. Early pre-report estimates for corn acres vary between 87 and 93 million acres.
Pre-report estimates for Friday’s Cattle on Feed report:
On Feed as of June 1: 99%, with a spread from 98.3% to 100%
Positioned in Might: 98.5%, with a spread from 95% to 102.4%
Marketed in Might: 100.5%, with a spread from 99.3% to 102.3%
The chance of loss buying and selling commodity futures and choices could be substantial. Buyers ought to rigorously contemplate the inherent dangers in gentle of their monetary situation. The data contained herein has been obtained from sources deemed to be dependable, nonetheless, no impartial verification has been made. The data contained herein is strictly the opinion of its creator and never essentially of Ever.Ag and is meant to be a solicitation. Previous efficiency is just not indicative of future outcomes.
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