I’ve never seen packers chase cattle in June. Normally demand has peaked by this date and we enter a void of beef demand for 60 days or more. It’s called the dog days of summer.

Last week packers bid aggressively to secure more than 90,000 head in the negotiated cash steer market. This week, in the face of a bearish cattle-on-feed report, packers are still chasing.

The latest information as of my publishing cutoff is that packers are bidding $1.89 in Texas, up $3 from the previous week, paying $1.90 to own some cattle in Kansas with additional bids noted at $1.91 and being passed. The market in the North is even hotter with talk of $1.97 bids in eastern Iowa being passed and bids in western Iowa at $1.99, also being passed. The Nebraska market is unknown.

The cattle-on-feed report was termed bearish compared to trader expectations. On-feed was pegged at 100%, placements were measured at 104% with marketings at 100%. The trade was off on the placement numbers with average guesses at 98% going into the report. Actual placements at 104% were 2% higher than the highest estimate.

Cattle weights are record heavy, but the latest information indicated weights were down six pounds from the previous week, yet still up 36 pounds from this time last year. The wholesale beef market is supposed to be topping. Instead, choice beef edged into new yearly highs this week, nearly reaching $323.

Live cattle futures are trading at sharp discounts to the cash steer market. Cash steer prices are at record highs. With the five-area average cash steer price north of $1.92, there won’t be any deliveries against the soon to expire June live cattle contract. June futures last settled at $187.60. If none of this makes any sense, join the party.

Some seasoned cattle fundamental analysts are so confused that they’ve decided to call for a major top in cattle prices. I’m not in that camp, by the way. In fact, in my opinion these experts are about to miss a huge rally in cash, futures and cutout values. Not to worry, they’ll quickly say “just kidding.”

The sharp decline in cow slaughter this year in combination with rain in the great plains and lower trending feed input costs will trigger heifer retention late this summer and into fall. This will tighten up on-feed inventory and drive prices sharply higher. I expect retail margins to narrow during this timeframe, allowing for sharply higher wholesale prices with retail prices only edging higher.

By the spring of 2025 cash steer prices should be at levels most never dreamed possible. Those calling for a major top in cattle prices in the summer of 2024 will have to scrub hard to get the egg off their faces.