Cattle Futures Close Week on Back and Forth Note Ahead of Inventory Report

Live cattle and feeder cattle futures finished Thursday in mixed territory, navigating the back and forth trading pattern that has characterized recent sessions. The broader cattle complex remained under pressure as traders awaited key economic data, with most contracts posting losses for the day even as some specific positions managed modest gains.

Price Movements Across Live and Feeder Contracts

Live cattle futures declined across most contracts, with losses ranging from $1.10 to $1.50. The February delivery finished at $235.50, down $1.325, while April closed at $237.275, down $1.450, and June ended at $233.275, down $1.175. Open interest expanded by 820 contracts on the day, reflecting continued participation despite the downward pressure.

Feeder cattle futures demonstrated greater volatility in their back and forth movement. January feeder cattle, which was expiring during the session, posted a gain of $1.07, bucking the broader decline. However, other months surrendered ground, with March finishing at $365.125, down $0.725, and April at $363.225, down $1.075. The CME Feeder Cattle Index rebounded to $366.69, up $2.70, on January 28.

In the cash market, trading activity remained limited this week. Fed Cattle Exchange online auction activity showed bids in the $232 to $233.50 range on 1,510 head offered, though no transactions materialized at those price levels.

Export Sales Surge While Supply Metrics Paint Mixed Picture

Export performance provided a bright spot in an otherwise cautious market environment. Beef export sales reached 16,893 metric tons during the week ending January 22—the strongest showing since November. South Korea led purchasing activity with 7,600 metric tons, while Japan secured 4,900 metric tons. Actual beef shipments totaled 12,574 metric tons that same week, with 3,800 metric tons destined for South Korea and 3,600 metric tons heading to Japan.

Supply data presented a more concerning backdrop. Census trade information revealed beef exports on a carcass basis fell to 190.4 million pounds in November, marking the lowest volume since 2009. Beef imports declined 1.2 percent year-over-year, totaling 151,316 metric tons on a tonnage basis. These figures weighed on market sentiment as traders anticipated the release of the annual USDA Cattle Inventory report scheduled for later in the week.

Market Focus Shifts to Livestock Health and Inventory Data

Disease surveillance updates continued to draw attention from market participants. The APHIS latest report revealed four additional cases of New World screwworm in Tamaulipas and one additional case in San Luis Potosi, bringing total active cases in those Mexican states to 13. Such developments, while not immediately market-moving, remain on traders’ radar as they could affect cattle availability and trade flows.

The upcoming USDA Cattle Inventory report held particular significance, with traders anticipating total cattle and calves would decline 0.3 percent from the prior year. Beef cow numbers were expected to post a modest 0.4 percent gain, while replacement heifer inventories were projected to rise 1.7 percent year-over-year.

Wholesale Beef Values Retreat as Week Concludes

Wholesale boxed beef prices extended their recent back and forth decline during Thursday afternoon’s trading. Choice boxes declined $2.08 to close at $367.66, while Select dropped $2.85 to finish at $360.72. The Choice/Select spread widened to $6.94, reflecting differentiated demand patterns across quality tiers.

Cattle slaughter estimates suggested a slower week ahead. Wednesday’s USDA federally inspected slaughter was estimated at 112,000 head, bringing the weekly total to 436,000 head. This represented 11,000 head below the previous week and 47,143 head below the comparable week the prior year, underscoring the softer tone to near-term supply.