December 2023

By Cassie Fish, http://cassandrafish.com

CME cattle futures action today has been defensive, the market selling off after a rally and most contracts are caught in a nine day long trading range. The negotiated fed cattle market, on the other hand, is trading now in Texas at $172, $1 higher than last week, the highest since the week ended December 1, that averaged $174.45. Higher cash money this week was anticipated and highly probable. December live cattle futures continue to outperform the other LC contract months, today reaching its highest level since December 1. December is actually just slightly higher than the close the last day of November, eclipsing the big losses saw early this month.

It’s understood that packers need inventory and getting away with only paying up a buck is fortunate for them, though Kansas and Nebraska are passing $172 bids and may well get $173.

Choice boxed beef values made a new low for Q4 this morning as the choice rib dropped dramatically, printing at noon at $524/cwt when just on Tuesday it was quoted at $568. A break in the rib is entirely seasonal.

The USDA released actual slaughter and carcass data today and the average steer carcass weight, for the week ended December 16 clocked it at 941 pounds, up 2 pounds from a week ago, up 14 pounds from a year ago and the highest for any time ever. Carcass weights ‘should’ be topping and typically would have by now. No doubt the slow slaughter pace the majority of the time since April has destroyed front-end currentness and taken the edge off of upside potential for fed cattle prices. Not to say cash cattle prices won’t rally in Q1, its highly probable they will, but the upside is and will be limited because of the lack of currentness.

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