Morning Livestock Report, 10/19/2015

Monday, October 19, 2015

It took three weeks in late September for the cash cattle market to plunge from roughly $140 to $120; in the two weeks since, we've now rebounded fully $17 of that. Friday we witnessed some cattle trade early in the day at $130, but by 1pm they'd traded $135, and by 3pm $137. Futures of course liked the news and traded limit higher in each of the four nearby contracts and will be expected sharply higher again this morning. Weekly slaughter totaled 576K head, our third largest of the year, and larger than the 570-572K head estimates I'd seen as late as Friday morning. Can the beef markets maintain their rally in light of the larger production pace?? After Friday's big spend, spot packer margins aren't so hefty and the industry will focus more attention this week on the ability of the wholesale beef market to keep pace with what's happened in the cattle. Do remember the USDA will issue their monthly Cattle on Feed report this Friday. Early ideas have the Oct 1 on feed total at 101-102% of last year, Sep placements 95%, and Sep marketings 97%.

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