February cattle closed slightly higher on the session yesterday but 125 points below their early peak. A weaker tone in beef late yesterday may have pressured the market overnight and sent prices down towards their lowest levels since December 22nd. A weaker US dollar plus a surge higher in gold and energy markets and a much better short-term economic view from stock market traders helped to support early gains. However, some traders see cattle prices as relatively high and there is continued concern that consumers will resist higher beef prices and demand will slow. The overall supply outlook continues to provide underlying support as many traders see per capita available beef supply in the US down 5% to 6% from last year's levels. The estimated cattle slaughter came in at 132,000 head yesterday. This brings the total for the week so far to 138,000 head, up from 134,000 head last week at this time but down from 243,000 a year ago. Boxed beef cutout values were down 8 cents at mid-session yesterday and closed 65 cents lower at $194.08. This was up from $192.42 the prior week.
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