Sort & Cull

The world we live in may not be perfect, and there are undoubtedly things that we would still like to see changed in the cattle industry, but these prices -- they're what cattlemen dream of!

Last week the fed cash cattle market scored new all-time high prices to start the year on an undoubtedly bullish note and propel the market into another unmatched year. Last week Southern live cattle traded at mostly $196 to $197, which is $4.00 to $5.00 higher than the previous week. Northern dressed cattle traded at mostly $312 to $315, which is $5.00 to $8.00 higher than the previous week's weighted average. Which leaves everyone scratching their heads this week wondering: How much higher can the market trade this week?

Given the fact that over the Christmas and New Year holiday weeks, packers hardly participated in the cash market, it's very likely they're still short-bought and will need to support this week's complex despite the fact they loathe to see prices trade any higher. For the week ended Dec. 23, 2024, packers only bought 49,864 head in the negotiated cash cattle market; for the week ended Dec. 30, 2024, packers only bought 44,027 head in the negotiated cash cattle market; and just last week packers bought 85,514 head in the cash market. Of last week's purchased, 77% (65,944 head) were committed to the market's nearby delivery, while the remaining 23% (19,570 head) were committed to the market's deferred delivery.

With boxed beef prices seeing tremendous demand from retailers as they aim to restock their coolers after the holiday season, it's unlikely packers will want to limit processing speeds drastically as that would limit some of the beef, they could potentially market. Last week's choice cuts averaged $324.58 (up $5.00 from the previous week) and select cuts averaged $295.05 (up $6.17 from the previous week).

It's too early in the week for any asking prices to have been posted, but trade is expected to be wild again this week. Worst case scenario, cattle could trade steady. But it's more likely they will trade higher as packers are backed into a corner and feedlot managers seem more committed than ever before to marketing their showlists to the best of their ability, all while packers are kicking themselves for not having bought more inventory in weeks past.

ShayLe Stewart can be reached at ShayLe.Stewart@dtn.com

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