The Feeder Cattle Index increased and is at 228.76as of 11/15/2023.
February Live Cattle opened lower, made the high at 178.575 and broke down the rest of the session to the low at 175.05. It settled near the low at 175.325. The breakdown took price to trendline support at the same price as the low. Cash traded weak on Thursday with sales from 175.00 to 178.00, which is lower than last week’s average price. Outside market weakness as Crude Oil was pummeled helped foster demand for beef worries. Major retail outlets are preaching consumer demand changes as they move towards cheaper products. There were also unconfirmed rumors that Tyson was hacked (how convenient). Cutouts continue to fall, our exports were lousy all weighing on traders with the Cattle on Feed Report out after the close on Friday, these worries led to a risk off mentality in the cattle market, in my opinion. Cattle on Feed estimates are On Feed at 102%, Placements at 106.1% and Marketings at 98%. A failure below the trendline which is rising and will be at 175.125 on Friday could see price test support at 174.425. The rising 200-DMA now at 173.425 is the next level to test. Support then comes in at the old all-time high at 172.75. If futures can hold settlement, a test of the 175.95 resistance level is possible. Resistance then comes in at 178.10.
Boxed beef cutouts were lower as choice cutouts decreased 1.61 to 294.72 and select decreased 0.20 to 267.65. The choice/ select spread narrowed and is at 27.07 and the load count was 135.
Thursday’s estimated slaughter is 119,000, which is below last week’s 122,000 and last year’s 126,000. The estimated total for the week (so far) is 495,000, which is above last week’s 493,000 and below last year’s 512,000.
The USDA report LM_Ct131 states: Thus far for Thursday in the Texas Panhandle negotiated cash trade has been light on light to moderate demand. Compared to last week in the Texas Panhandle live FOB purchases traded 3.00 lower at 178.00. For Thursday in Kansas negotiated cash trade has been light on moderate demand. Compared to last week in Kansas live FOB purchases traded mostly 2.00 lower at 178.00. Thus far for Thursday in Nebraska negotiated cash trading cash trading has been light on light to moderate demand. Compared to last week in Nebraska live FOB purchases traded 3.50 lower at 178.00. The most recent dressed delivered was Wednesday at 282.00. In the Western Cornbelt negotiated cash trading has been light on light to moderate demand. Compared to last week in the Western Cornbelt live FOB purchases traded steady to 2.00 lower at 178.00. Last week dressed delivered purchases traded from 283.00-287.00.
The USDA is indicating cash trades for live cattle from 175.00 – 181.00 and from 278.00 – 282.00 on a dressed basis (so far).
For those interested I hold a weekly livestock webinar on Tuesdays and my next webinar will be on Tuesday, November 21, 2023, at 3:00 pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon completion of the webinar.
**Call me for a free consultation for a marketing plan regarding your livestock needs.**
Ben DiCostanzo
Senior Market Strategist
Walsh Trading, Inc.
Direct: 312.957.4163
888.391.7894
Fax: 312.256.0109
Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
tested support at the
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (“WTI”) shall not be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.