Steve Kay's Friday Market Update

Sept. 5 -- The cash live cattle trade Friday morning was light at prices $7-8/cwt. higher on the Southern Plains than the week before. USDA’s mandatory price reporting (MPR) service reported that Nebraska sold 6,563 head at $161.78 live or $251.79 dressed for a weekly total of 16,485 head. Iowa-southern Minnesota sold 6515 head at $159.63 live or $250.39 dressed for a weekly total of 29,024 head. Kansas sold 6545 head at $162.71 live for a weekly total of 6795 head. Texas sold 471 head at $162.87 live for a weekly total of 1184 head. The MPR weekly totals include negotiated cash and grid sales.

Live cattle futures closed sharply higher. October closed up 270 points at $159.75 (vs. $151.42 last Friday), December closed up 242 points at $160.92, February closed up 250 points at $159.20, April closed up 180 points at $157.55, June closed up 95 points at $149.50 and August closed up 40 points at $147.40.

The week’s cattle slaughter was an estimated 518,000 head (vs. 575,247 head last year), with Friday’s kill 116,000 head and Saturday’s kill 44,000 head. Year-to-date FI slaughter is an estimated 20.502M head, down 7.1% or 1.556M head from 2013’s 22.058M head. Hog slaughter year to date is down 5.3% or 3.981M head on last year.

Boxed-beef cutout values were firm to higher on moderate demand and light to moderate offerings. The Choice cutout increased $0.55/cwt. from the day before to $248.67/cwt. (vs. $246.30 last Friday) and the Select cutout increased $1.56 to $236.25 (vs. $234.39 last Friday). The Choice-Select price spread was $12.42, vs. $10.91 the Friday before. The reported spot boxed-beef trade for the week was 740 loads of fabricated cuts, down 3.1% from the 764 loads of fabricated cuts last week.

Packer margins for the week were positive by $33.90/head, compared to a positive $62.82 the week before, according to HedgersEdge.com.

PLEASE NOTE: There will be no Market Update the next two Fridays due to business travel. The next will be on Sept 26.

Have a good week,

Steve Kay

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