April cattle closed sharply lower on the session yesterday for the second day in a row, and finished with the lowest closing price since February 9th. The market traded higher early during the session, but growing concerns that higher oil prices will eventually hurt consumer purchasing power helped to spark a turnaround that sent prices sharply lower for the day. June cattle posted contract highs Monday, but ultimately closed at the lowest level since February 11th. Ideas that weaker packer profit margins could result in a slowdown in slaughter levels during the near-term was felt to be a potentially negative force for the cash market. The general market perception that higher gasoline prices will cause consumers to shift away from beef has also been seen as a negative factor that has helped to drive the market lower during the past few sessions. However, beef prices are moving higher and rose to their highest levels since early February as supplies are projected to tighten during the near future. Feedlots are pricing cattle at $115.00 this week after cash traded mostly $111.00-$112.00 last week. Slaughter levels were a little higher than expected yesterday at 130,000 head. This brings the total for the week so far to 256,000 head, up from 243,000 head last week at this time and up from 245,000 head a year ago. Boxed beef cutout values were up $1.09 at mid-session yesterday and closed $1.01 higher at $172.41. This was up from $169.56 the prior week and is the highest beef market since February 2nd.
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