Big Up

By Cassie Fish, http://cassandrafish.com

CME cattle futures rallied hard, led by a northern cash fed cattle price surge. It’s been a long time coming but tight supplies north, where there are fewer captive supplies, pushed cash prices to $147 and $238 dressed tops. Total cash trade in Iowa as of this afternoon was 20k, Nebraska 32k, Texas 11k and Kansas 21.5k. The top in the south is $141 for the week, a larger-than-normal discount to the north.

Of course, May and June are typically peak seasonal beef demand with Mother’s Day, Memorial Day and Father’s Day driving beef features. Slaughter levels increase in May and June from the first four months of the year. But front-end currentness, especially in the north is pushing cash cattle prices back to the highs saw in February when prices averaged $143.22. This week may very well have topped February since more volume has traded at a higher price.

CME cattle futures responded by taking out the March futures high, the August LC chart especially friendly having held the 100-day yesterday before surging to the highest level today since February 23. The August contract high was $141.82 made February 10, so it will be key to watch the action in the coming days to see if August checks that high. October is near its contract high and December LC made a new contract high today. Even April, which expires next week, gapped higher today, and closed strong.

Boxed beef values continue to trade sloppy, choice down about $4 from its recent high. Today’s slaughter was 125k head and expectations for the week are 650k, give or take.

Corn put in another powerful upside performance today, which limited feeder cattle futures advances.

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