Markets — March 28, 2016
Compared to last week, calves and stocker cattle traded mostly steady to 5.00 Lower. Yearlings traded steady to 5.00 lower early in the week, then turned mostly 3.00-8.00 lower from mid-week on. Purchasing of stocker cattle and calves for grazing still remains very good as cattle growers want to turn-out a stocker that will weigh over 800 pounds by late summer. Last Friday’s cattle-on-feed report brought the first bearish signal to the feeder cattle market since the last report was released a month ago; as numbers all came in a little above industry estimates. On average analysts expected placements to be up near nine percent than year ago levels which USDA survey showed placements a little over 10 percent higher. Not that much of a difference really and should not impact supply projections for the months ahead, but bearish news travels fast. Cattle futures reached an overbought status and futures had five straight sessions of losses, before closing higher on Thursday. This put a damper on the uptrend support, as futures turned defensive on a bearish reversal that definitely put stress on the feeder cattle market. The sharp drop in the futures does grab ones attention, as it seems the breaks always happen quicker than the rallies. The combination of a bearish cattle on feed report followed by a sharp drop in the cut-out value has weighed on the cattle complex this week, along with looking at lower fed cattle trade this week. Thursday in the Southern Plains live sales traded mostly 3.00 lower at 136.00 and dressed sales in Nebraska sold mostly 5.00 lower at 218.00.