October Cattle Report Predictable, Markets Hit 7-year High

WASHINGTON, DC – The live cattle market is trading higher based on strong cash market trends, says Oliver Sloup with Blue Line Futures.

USDA’s five-area weekly average price is the highest mark the market has seen since 2015, trading near $150/cwt, while the five-year average is nearly $30 less.

The markets closed Friday before the National Agriculture Statistics Service (NASS) released the October Cattle on Feed Report, which fell squarely in line with analysts’ predictions.

Cattle on calves on feed for the slaughter market in the U.S. (feedlots with a capacity of 1,000 or more head) totaled 11.4 million head, a one percent decrease from last year.

More heifer and heifer calves are coming into the group, though NASS says steer and steer calves still make up 60 percent of the inventory.

Placements were 2.08 million head, four percent below 2021, while marketings of fed cattle during September totaled 1.86 million head, a four percent year-over-year increase.

“Now the strong cash prices are especially impressive considering the fears in the outside markets of slower economic growth and potential recessions around the world,” Sloup adds.

With the most recent Commitment of Traders report showing managed money or funds in a relatively neutral position – long roughly 30,000 contracts of live cattle – “if the cash market continues to firm, it may entice funds to add to their net long position which may help support futures in the near term.”
(SOURCE: All Ag News)