Page 8 - MWC 9-14-2023s

The Midwest Cattleman · September 14, 2023 · P8

MARKET REPORT

Live Cattle Feeder Cattle Daily

Live Cattle: Feeder Cattle:
The market is now implying that our recent weeks of $178/$179 Over a month has passed since the seasonal peak for feeder
pricing in the South will push to $187 by year’s end. These ex- cattle. So far, there is no sign of a top. Given that we are in an
treme prices already have the current 6% beef production cut fac- artificial period of pricing, we cannot call a strong top. In this
tored in. We’re also regaining ownership of the retail dollar from special period the largest rally will come for calf and feeder prices,
packers. In addition, the expectation of ever lower production not the back end of the beef complex. As with the prior extreme
ahead through 2024 is a factor. Given that we’re in a very special rally noted from 2013 – 2014 we may see cattle feeders buy at any
period here from 2023 – 2026 we can’t say fed cattle prices have price and come back for more the next week. Normal rules, such
Feeder Cattle: All you have to do is look at the corn market for a reason for the
Live Cattle: My thoughts center around this market stabilizing now. I’ve been
to fall. The normal rules do not apply here. as pointing out $200 - $209 per cwt. breakevens on these feeders
placing a bullish tilt to this market for some time now. I may need to temporarily pull-back in feeders. If I owned a feedlot I’d be nervous to say the least. I do feel
the feeder market has overdone it to the downside and it will be tough to break it
place this on “hold” for a while. The higher placements the last three months will take a back seat to psychology.
From the last issue we discussed protecting coming Q1 feed-
have a negative impact on prices yet, so like they say, “All good things come to those further. The early corn harvest has most feeder buyers in the field and I don’t think
who wait”. I see production numbers staying over last years’ levels until at the er cattle sales for producers that allowed for upside to $256 on
they’ve really had time to concentrate on buying feeders. Let’em get caught up a
least the end of the year. Beef shipments have been lagging last years’ levels now the January. That top end price is 42% over last year’s January
little and they’ll head to town.....checkbooks in hand....bulging with “corn” money.
for about a month. Two weeks ago they were 8% lower than last year. This weeks futures end. That issue also discussed the idea that cattle feed-
This market will rally....wait and see.

report showed exports a whopping 56% lower than last year. This ain’t good. Low ers should procure their entire slug of 2024 needs on the coming
imports and high exports have held this market up all summer. We’re starting to
lose some of that. I just can’t pull the trigger yet on long term bullish hopes. seasonal low ahead, similar to our discussion for 2023 needs. That
has so far not happened.
Trading commodity futures involves substantial risk of loss
and my not be suitable for all investors. The recommendations
Rich Nelson express opinions of the author. The information they contain is
Allendale Inc. Allendale Inc. obtained from sources believed reliable, but is in no way guaran-
815-578-6161 teed. The author may have positions in the markets mentioned
including at times positions contrary to the advice quoted herein.
rnelson@allendale-inc.com Opinions, market data, and
recommendations are subject to change at any time.
What Does this Report Mean to Me?
Q #1
Q: What should we expect for cattle feeding profits into 2024?
What do you think the price of fats will be in April 2011
Answer: It’s hard to see the forest for the trees here, but peering through the foliage I see $105.00 fats on the horizon for April. Demand is
A: That’s a very tough question, not because it is hard to answer but because the answer is not what we want to hear. Feeder prices
going to have to kick in though in order to get it.
have yet to top. Futures indicate feeders will rally even more in the months ahead, contra-seasonally. Positive for feeders, we still
suggest lower corn pricing and higher fed pricing ahead in the coming months. We’re not quite sure that will be enough though. We’re
Q #2
Due to the recent break in feeders, would you be holding your fall-weaned
penciling out a minimum needed rally, past current for summer 2024 fed cattle futures, of at least $12/cwt more.
calves for a while or letting them go?
Q: What was pricing like in the 2013 – 2014 rally?
Answer: What ever happened to the easy questions? This will depend upon your weaning sched-
ule and your available feed supply. I’m long term bullish the feeder market but the “reality” of
A: From the low in 2013 to the peak in 2014 calves rallied 107%. Feeders, using that same guide, were up 89%. So far calves
right now probably dictates letting them go. If you keep them for an extra 30 days, make sure you
this year are up 64% from the low point in 2022. Feeders are up 68% from last year’s lows. We are in no way saying these are the
minimize the grain in the ration. Grow them on good forage....”sell” $4.50 corn. If the fat market
stays sluggish and corn prices don’t moderate, about the only thing you’ve got to hang your hat on
metrics to use for this year. Heck, the real tightness of supply won’t really start until next year. That will be the one to get excited
for “higher feeders” is “Hope”.
about.
November 6th
Auction

Lunch at 11:00 a.m.
Sale at 12:30
Sale Offering
16 - 2010 Heifer Calves Jan. - May
16 - Breeding Bulls 7 to 18 months RH Standard Lad 0313
16 - Spring Calving Bred Females Solid As A Rock Sire Group
16 - Spring Calving Black Females Reynolds Herefords
Bred to Hereford Bulls
8 - Fall Calving Pairs 1071 County Road 1231
6 - Show Steer Prospects
Both Horned & Polled Offered Huntsville, MO 65259
Home: 660-277-3679 • Matt: 660-676-3788
November 5, 2010 Sale offerings on
Display 3:00 P.M.
CHB Dinner at 6:00 P.M. • Barb: 660-676-4788
Call or E-Mail for Catalog Email: reynoldscattle@cvalley.net