The cattle market pushed sharply higher on the session yesterday as weather threats, fund buying and expectations for better export markets ahead were seen as supportive factors that drove futures to new contract highs and nearby futures to a new all-time high of 109.05. Snow in the plains was also thought to be a factor that supported the market as some traders believe that cash could trade higher and that the weather might trim average slaughter weights that have been a little higher than normal recently. Cold and snowy weather could cause weight-loss issues, and there are ideas that higher beef prices could support steady/firm cash cattle trade this week. Severe flooding continues in Australia, and this has been widely seen as impacting beef exports to the US and to Asia.
Tainted feed issues in Germany were also felt to be a key reason to project larger meat exports from the US. China dropped its ban on US beef imports in December and a trade delegation from China will be in Chicago next week. Cash cattle offers in the southern plains came in at $107-$108 as compared with cash trade at $106 last week. Ideas that disease issues in South Korea could eventually support higher exports to the region and that European grain issues could support better pork exports over the near-term added to the positive tone. The estimated cattle slaughter came in at 126,000 head yesterday. This brings the total for the week so far to 242,000 head, down from 243,000 head last week at this time and down from 252,000 head a year ago. Boxed beef cutout values were up 76 cents at mid-session yesterday and closed 94 cents higher at $167.42. This was up from $165.92 the prior week and is the highest beef market trade since May 20th.