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Price action: December live cattle futures lost $2.50 at $187.925 and near the daily low. For the week, December live cattle fell $3.425. November feeder cattle futures dropped $2.775 at $254.90 and near the session low. On the week, November feeders lost $8.625.
5-day outlook: Today’s big declines in December live cattle and November feeders, including a technically bearish weekly low close in December live cattle, set the stage for follow-through chart-based selling pressure early next week. Cash cattle market fundamentals have deteriorated a bit recently. Cash cattle trade averaged $183.59 so far this week. That’s down 95 cents from last week’s cash average of $184.54. The noon report showed Choice grade boxed beef cutout rose 90 cents to $302.41, while Select fell 11 cents to $277.33, taking the Choice/Select spread to $25.08. Movement at midday was 70 loads.
30-day outlook: The overall outlook for the cattle markets remains positive. Last week’s USDA Cattle-on-Feed report suggested fed cattle supplies will remain tight at least through the end of the year. Also, this week’s USDA Cold Storage Report indicated a modest seasonal rise in inventories last month, but with the implication consumer demand remained strong in late summer. Record-high retail beef prices may crimp consumer demand at some point, but that point has not been the case yet.
90-day outlook: USDA on Thursday reported upbeat U.S. beef export sales of 17,700 MT for 2023, up 29% from the previous week and up 42% from the four-week average. U.S. beef sales abroad will have to continue to improve for cattle prices to remain at their elevated levels. A strong U.S. dollar index that this week hit a 10-month high will be an impediment for better U.S. beef sales abroad—especially as beef prices are already historically high.
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