Steve Kay's Friday Market Update

Jan. 23 -- The cash live cattle trade Friday morning was light. USDA’s mandatory price reporting (MPR) service reported that Nebraska sold 1837 head at $253.50 per cwt dressed for a weekly total of 34,778 head. Iowa-southern Minnesota sold 4497 head at $159.10 live or $255.111 dressed for a weekly total of 17,980 head. Kansas sold 961 head at $159.81 live for a weekly total of 6855 head. Texas sold 811 head at $160.00 live for a weekly total of 1696 head. The MPR weekly totals include negotiated cash and grid sales.

Live cattle futures closed limit down to sharply lower. February closed down its daily 300-point limit at $150.35 per cwt (versus $154.45 last Friday), April closed limit down at $148.80, June closed limit down at $143.77, August closed down 257 points at $142.20, October closed down 250 points at $144.75 and December closed down 247 points at $145.80. The March to August feeder cattle contracts all closed down their 450-point daily limit.

The week’s cattle slaughter was an estimated 576,000 head (versus 599,844 head last year), with Friday’s kill 108,000 head and Saturday’s kill 35,000 head.

Boxed beef cutout values were lower on light demand and light to moderate offerings. The Choice cutout declined $1.91 per cwt from the day before to $253.74 per cwt (versus $260.45 last Friday) and the Select cutout declined $1.66 to $247.23 (versus $250.84 last Friday). The Choice-Select price spread was $6.51 versus $9.61 last Friday. The reported spot boxed beef trade for the week was 569 loads of fabricated cuts, up 17.3% from the 485 loads of fabricated cuts last week.

Packer margins for the week were positive by $9.62 per head, compared to a negative $36.85 the week before, according to This was the first positive week since the week ended September 12, 2014.



USDA released its monthly Cattle on Feed (COF) report Friday afternoon. The numbers for U.S. feedlots 1000 head or larger were:

  • COF 1 January 1: 10.690M head, 100.9% of a year ago
  • Placed in December: 1.544M head, 92.0%
  • Marketed in December: 1.655M head, 95.3%

Analysts regarded the report as neutral to slightly negative. December marketings were down more than 9% from a year ago after taking December’s one extra slaughter day into account. At 95.3% of a year ago, they also fell 0.5% below analysts’ forecasts.

December placements though were 3.7% lower than forecast. So the Jan 1 COF total was 0.5% below the average forecast. This was the third COF total in a row above a year ago but by only 10,000 head. Texas edged Nebraska for the state with the most cattle on feed, 2.500M head, versus 2.490M head in Nebraska. Kansas was third with 2.050M head. These three states and Idaho, Iowa, Minnesota and Washington all had more cattle on feed than a year ago. Only Idaho and Iowa placed more cattle than a year ago. The weight breakdown showed the only year-on-year increase was in the heaviest category.

The under 700 lb category saw a 10.0% or 90,000 head decline. The 700-799 lb category saw a 14.0% or 55,000 head decline but the 800 lbs and over category saw a 2.6% or 10,000 head increase. Four states marketed more cattle in December than last year: California (up 4%), Minnesota (up 18%), Nebraska (up 5%) and Washington (up 14%). Kansas marketings were down 4% and Texas marketings were down 13%. Nebraska marketed 440,000 head versus 370,000 for Kansas and 365,000 for Texas.

Have a good week,

Steve Kay



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