Cash Fed Cattle Market Rallies $4 to $5

February 17, 2018 07:54 AM
 
Rising futures prices encouraged packers to raise bids $4 per cwt. on market-ready cattle.

Cash fed cattle prices jumped $4 per cwt. to $130 on Friday afternoon, with dressed sales in the North $5 higher at $205. On Wednesday, top sales at the Tama Livestock Auction in Iowa registered $132 per cwt.

The week began with a strong undertone as feedyard supplies of market-ready cattle have tightened. Packers drug their heels at the higher asking prices, but anted up Friday afternoon as CME futures prices for the nearby February contract closed above $130. Live Cattle contracts closed $2.62 to $4.15 higher compared to the previous Friday.

Auction prices for feeder steers and heifers were called steady to $5 per cwt. higher on the week. Agricultural Marketing Service reporters said demand for suitable grazing cattle is strong as buyers anticipate the supply decreasing in the weeks ahead. “Demand was quoted as good to very good at most auctions this week as long strings and high quality cattle were on consignment sheets,” AMS said.

A developing drought remains a concern for grazing operators, however. West Texas is in an extreme drought, and Amarillo has not received any measurable precipitation in four months.

Choice beef cutout closed Friday at $209.88 per cwt., $3.36 higher than last week. Select cutout closed at $205.12, up $2.38 for the week. The Choice/Select spread was $4.76.

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