Morning Cattle Market Report

February cattle made a strong recovery from moderately lower price levels yesterday to close slightly higher for the session. Outside market forces turned negative early yesterday and weakness in hogs helped drive the market lower into the mid-session. The dollar traded higher on the day and gold and energy markets turned lower. Uncertainty about cash cattle trading this week and the lowest weekly export sales total since the first week of the year helped to pressure. A weaker beef market had many traders talking about steady to lower prices this week but poor weather may help hold cash steady. Snow in the forecast for today and tomorrow in the central and southern plains could be a key market factor into next week. Some traders feel that the market may have the supply fundamentals to lift to a higher price level but demand remains a significant concern. Boxed beef cutout values were down 59 cents at mid-session yesterday and closed $1.17 lower at $193.26. This was down from $197.07 the prior week and is the lowest beef market since November 14th. Average dressed steer weights for the week ending November 19th came in at 852 pounds, unchanged from the previous week and up 0.12% from a year ago. Beef production for the same week came in at 491.1 million pounds, down 7.11% over year ago. Weekly U.S. beef export sales came in at just 9,100 metric tonnes, compared with the prior 4-week average of 12,575 tonnes. Cumulative sales for 2011 have reached 809,800 metric tonnes, up 27.4% from last year's pace. The estimated cattle slaughter came in at 131,000 head yesterday. This brings the total for the week so far to 515,000 head, up from 395,000 head last week at this time but down from 522,000 head a year ago.