Morning Livestock Report, 11/23/2015

Monday, November 23, 2015

Despite the ongoing intra-day volatility, cattle futures will finish the week very near unchanged, down as much as $1 in the nearby Dec live cattle contract and up $1 in some of the far deferred contracts. Last week's cash trade was light once again, with the Northern trade taking place at disappointingly lower values. Weekly slaughter totaled 571K head, up from 570K head this same week last year. The USDA’s Cattle on Feed report looks about as neutral as I remember with all three categories coming very close to their pre-report estimates. Oct marketings were a record low and our on feed count continues to trend above prior-year levels. Interesting to see one of the well-followed banks forecasting live cattle prices at $120 12 months from now, modestly below $125 Dec16 futures. The Livestock Marketing Information Center also now estimates fed cattle prices down 3-5% in 2016 and down another 1-4% in 2017 on cyclically larger beef production which we’re already beginning to see.

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