October cattle closed moderately higher for the session yesterday, and have closed higher in 4 of the past 5 trading sessions as many traders feel that the surge in beef prices recently will encourage increased activity in the cash market. Cash cattle offers are at $122.00 and $123.00 this week with bids emerging at $118.00, compared to $119 trades last week. Some traders see a smaller showlist this week with firmer demand from packers. Retailers are gearing up for Labor Day promotions, which helped beef prices reach their highest level since July 11th. Demand has been strong but there are concerns that demand might slow once bookings for Labor Day are complete.
The estimated cattle slaughter came in at 128,000 head yesterday. This brings the total for the week so far to 250,000 head, down from 254,000 head last week at this time and down from 259,000 head a year ago. Boxed beef cutout values were up $2.32 at mid-session yesterday and closed $2.32 higher at $189.21. This was up from $179.90 the prior week, and is the highest beef market since July 9th. Third quarter beef production is projected to reach a 7-year low, as dwindling supply after the culling of herds last year is thought to have taken a heavy toll on the industry.