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Livestock prices tumbled across the board this past week, with cattle leading the stampede off the mountain. December Live Cattle futures lost $1.72 for the week ended Tuesday, while the February contract dropped $2.90 and April lost an even two bucks. Boxed beef cutout values were down $4.75 for Choice and $3.67 for Select and cash fed cattle last week lost a dollar, to trade at mostly $124. The drastic drop in prices seems to be from a combination of factors, with no overriding one dominant. Supplies of fed cattle are growing, and will likely continue to grow for the next couple of months. In addition, retailers have likely booked their needs for the Christmas and New Year’s celebrations, and the loss of that demand is pressuring prices for high end cuts, which is causing the drop in cutout values. And the tight packer margins seen recently are giving buyers more leverage now that supplies of market-ready cattle are growing. Expect cash prices for fed cattle this week to be lower, probably by at least a couple of dollars.
Feeder cattle prices also slumped this week. The January futures contract lost $2.70 for the week, with March down $2.55 and April off $2.45. The fading fed cattle market, as well as signs that the slide in corn prices may be flattening out, were the main culprits in lower feeder values this week. Even the cash market for calves and feeders was mostly softer at early-week auctions.
Hog values followed cattle prices lower, with the December Lean Hog futures down $1.85 and February off $2.12. Cash butchers in Red Oak traded a dollar lower on Tuesday at $57. Pork prices do have one factor lending them strength, and that’s the record spread in price between beef and pork. Retailers and consumers may take advantage of that big discount to serve more ham and pork chops and fewer steaks in the next month or two.
Grain prices are showing some signs of stabilizing, although corn prices were lower for the week. Soybean futures prices were higher, with the January and March contracts up more than four cents and May up more than a nickel. New-crop November gained more than 13 cents in the week ended Tuesday. Signs of an improving economy, as well as a drying trend in parts of South America and a belief that China may soon be in a shopping mood, all contributed to firmer bean values.
Wheat prices were mostly higher this week as well, with the December contract in Kansas City up 11 cents, while the March and May both gained six. The narrowing spread between the December and March also indicated underlying commercial interest. Wheat futures in Chicago exhibited the same trend of narrowing spreads, with the December contract up more than four cents, while the March lost three.
Corn prices slid lower again this week, but the pace of the price slide slowed, as the other grains lent strength to corn. December Corn futures were down nearly 13 cents compared to last Tuesday, but March lost only nine cents and May was off less than eight cents for the week. Slow exports have been a major contributor to crashing corn prices the past couple of months, but with lower prices now available, don’t be surprised to see both foreign and domestic demand pick up as we move toward 2012. That could be especially true if the plans and agreements to prop up the European economies hold and the dollar weakens.
This Friday, USDA releases the monthly Supply and Demand and Crop Production reports. Most interest will be on the S & D, particularly to see if USDA lowers its export predictions for the current marketing year. Weather will factor into livestock pricing, particularly if the cold and snow continues and starts seriously affecting feedlot performance. And the approaching holidays will soon start to affect trading volume and general interest until the New Year.
Livestock prices tumbled across the board this past week, with cattle leading the stampede off the mountain. December Live Cattle futures lost $1.72 for the week ended Tuesday, while the February contract dropped $2.90 and April lost an even two bucks. Boxed beef cutout values were down $4.75 for Choice and $3.67 for Select and cash fed cattle last week lost a dollar, to trade at mostly $124. The drastic drop in prices seems to be from a combination of factors, with no overriding one dominant. Supplies of fed cattle are growing, and will likely continue to grow for the next couple of months. In addition, retailers have likely booked their needs for the Christmas and New Year’s celebrations, and the loss of that demand is pressuring prices for high end cuts, which is causing the drop in cutout values. And the tight packer margins seen recently are giving buyers more leverage now that supplies of market-ready cattle are growing. Expect cash prices for fed cattle this week to be lower, probably by at least a couple of dollars.
Feeder cattle prices also slumped this week. The January futures contract lost $2.70 for the week, with March down $2.55 and April off $2.45. The fading fed cattle market, as well as signs that the slide in corn prices may be flattening out, were the main culprits in lower feeder values this week. Even the cash market for calves and feeders was mostly softer at early-week auctions.
Hog values followed cattle prices lower, with the December Lean Hog futures down $1.85 and February off $2.12. Cash butchers in Red Oak traded a dollar lower on Tuesday at $57. Pork prices do have one factor lending them strength, and that’s the record spread in price between beef and pork. Retailers and consumers may take advantage of that big discount to serve more ham and pork chops and fewer steaks in the next month or two.
Grain prices are showing some signs of stabilizing, although corn prices were lower for the week. Soybean futures prices were higher, with the January and March contracts up more than four cents and May up more than a nickel. New-crop November gained more than 13 cents in the week ended Tuesday. Signs of an improving economy, as well as a drying trend in parts of South America and a belief that China may soon be in a shopping mood, all contributed to firmer bean values.
Wheat prices were mostly higher this week as well, with the December contract in Kansas City up 11 cents, while the March and May both gained six. The narrowing spread between the December and March also indicated underlying commercial interest. Wheat futures in Chicago exhibited the same trend of narrowing spreads, with the December contract up more than four cents, while the March lost three.
Corn prices slid lower again this week, but the pace of the price slide slowed, as the other grains lent strength to corn. December Corn futures were down nearly 13 cents compared to last Tuesday, but March lost only nine cents and May was off less than eight cents for the week. Slow exports have been a major contributor to crashing corn prices the past couple of months, but with lower prices now available, don’t be surprised to see both foreign and domestic demand pick up as we move toward 2012. That could be especially true if the plans and agreements to prop up the European economies hold and the dollar weakens.
This Friday, USDA releases the monthly Supply and Demand and Crop Production reports. Most interest will be on the S & D, particularly to see if USDA lowers its export predictions for the current marketing year. Weather will factor into livestock pricing, particularly if the cold and snow continues and starts seriously affecting feedlot performance. And the approaching holidays will soon start to affect trading volume and general interest until the New Year.
