Cattle Rally on Weaker Feed Cost

Front month fat cattle futures are trading $0.62 to $1.92 higher at midday led by the soon to expire August contract. USDA reported some light $144 cash trade on Monday in the WCB, not enough for a market test. Last week’s confirmed cash trade in the WCB was $145-$148 compared to $142 in the South. 

Feeder cattle futures are trading 0.94% to 1.32% higher after starting the week with losses. That has the Oct contract back to net above yesterday and just ~20 cents lower for the week to date.   USDA reported cash feeder cattle sales were steady to $4 lower in the OKC auction. Volumes were consistent with last week. Sharply higher feed costs are a concern. The CME’s Feeder Cattle Index was $183.16 on 8/26 after another 91 cent increase. 

Wholesale Boxed Beef prices from the Tuesday morning report were mixed as Choice bounced a dime to Select’s $1.18 drop. USDA estimated Monday’s FI cattle slaughter at 122k head, down from 125k head last week but still up 5k head from the same Monday last year. 

Aug 22 Cattle  are at $143.500, up $1.950,

Oct 22 Cattle  are at $144.025, up $1.125,

Dec 22 Cattle  are at $149.950, up $1.025,

Sep 22 Feeder Cattle  are at $182.050, up $2.125

Oct 22 Feeder Cattle  are at $183.075, up $2.000