Feeder cattle are commanding extraordinary prices in the physical market even as futures retreat. At the same time, softer feed costs may provide some relief to buyers, while mixed boxed-beef prices and changing slaughter volumes show that strength isn’t uniform throughout the cattle complex.
Lightweight feeder steers pushed above $500 per hundredweight at multiple Plains auctions Monday, with some 400- to 500-pound calves bringing as much as $537.50/cwt. The cash-market strength came even as live and feeder cattle futures moved lower on the Chicago Mercantile Exchange, according to the U.S. Department of Agriculture’s Agricultural Marketing Service.
The summary, published through the USDA’s MyMarketNews service, drew from sales in Nebraska, South Dakota, and Wyoming. According to the USDA summary, at Burwell Livestock in Burwell, Nebraska, feeder steers weighing 500 to 600 pounds were quoted at $512.50 per hundredweight, while 600- to 700-pound yearlings ranged from $432.00 to $465.00. Replacement heifers in the 500- to 600-pound class brought $427.50, and 600- to 700-pound females sold between $390.00 and $432.50.
The split between the cash and futures markets is notable. Buyers are paying steep premiums for animals that will not reach the slaughter market for months, signaling intense competition for available feeder cattle. At the same time, lower grain prices could offer feedlots some relief as they absorb the elevated cost of putting cattle on feed.
The strongest prices came from St. Onge Livestock in St. Onge, South Dakota, where 400- to 500-pound steer calves brought $512.50 to $537.50/cwt. The sale also reported 600-700-pound stockers at $343.
At Ogallala Livestock in Ogallala, Nebraska, 600-700-pound feeder steers brought $375 to $390, while heifers of the same weight sold for $360 to $368. Torrington Livestock in Torrington, Wyoming, reported 75 percent to 80 percent-lean boning beef at $151 to $155.
Futures ease, cutout mixed
Cattle futures gave back ground Monday, widening the contrast with the strength seen at the auctions. Per the USDA summary, October live cattle contracts on the CME settled at $212.95, off $1.35, and December closed at $214.725, down $1.40. September feeder cattle futures ended the session at $324.825, lower by $1.025.
Boxed beef moved in opposite directions. According to the the USDA summary, the daily estimated cutout ran $376.17 for Choice, off $0.73, and $355.87 for Select, up $5.15.
Slaughter numbers also point to a market that is strong but not moving in a straight line. Estimated Friday harvest was 97,000 head, bringing the week’s total to 509,000. That was below the 518,000 head recorded the previous week but above the 487,000 head slaughtered during the comparable period a year earlier.
Cheaper feed offers some relief
For cattle feeders, the decline in grain prices provided a modest counterweight to expensive feeder cattle.
According to the the USDA summary, September corn on the Chicago Board of Trade traded at $5.12 per bushel, down $0.0325, and the September soybean contract settled at $12.9375, lower by $0.125. Kansas City September wheat finished at $7.8675, off $0.1175.
That combination — expensive feeder cattle but softer feed costs — will be closely watched by feedlots. Lower grain prices can help improve feeding margins, but they also have to offset the unusually high upfront cost of buying calves and stockers.
The USDA report also included weekly accumulated weighted-average slaughter cattle prices and the CME Feeder Cattle Index, providing additional benchmarks for tracking how the cash market is performing against futures.
This article was prepared with the assistance of automated tools and human research and verified by our editorial team.
