Prepared and written by Jeff Swenson. The Market Update draws information from several sources, including trade publications, radio broadcasts, agricultural news services, individuals involved in the industry as well as USDA NASS and AMS reports.
Fed cattle prices were $2.00/cwt lower last week and were looking for direction as this week opened. The boxed beef cutout price was $217.64 on Tuesday (1/19) compared to $207.69 on the Monday prior (1/11). The cutout value is in line with a year ago ($212.00), although cash cattle are lower at $110.00/cwt compared to $124.00 last year. Live Cattle Futures contracts were stronger through Thursday while corn and soybeans traded lower. Packers have plenty of cattle to work through with last week’s harvest estimated at 651,000 head compared to 633,000 the comparable week a year ago. The USDA will release a Cattle on Feed report Friday (1/22). Trade expectations are for cattle on feed at 99.3 percent of a year ago, placements at 97 percent and marketings at 100.7 percent.
Last week’s weekly hog harvest was estimated at 2.654 million head which would be 200,000 head less than the first week of 2021. Since the last two weeks of 2020 each included a holiday, it makes sense that we would see a large harvest week to open the year. If last week’s USDA estimate is correct harvest would still be 6 percent above a year ago. Cash hog prices were slightly higher by Thursday (1/21) with carcass cutouts showing modest strength as well. Chinese authorities on Thursday released 30,000 tons of pork from its central reserves to increase meat supply for the upcoming Spring Festival holiday, the National Development and Reform Commission said. A total of 150,000 tons of reserve pork has been released into the market since December 17, 2020 to ensure supply for the New Year and Spring Festival holidays, according to the commission. China hadn’t been a major buyer of US pork recently, but did purchase 4,300 metric tons last week.
The retail price for beef averaged $6.54 in 2020, 8 percent higher than 2019. The highest beef prices occurred in May when beef prices were 23 percent higher than May 2019. Beef prices leveled by December and were 3.3 percent higher than the same month in 2019. Pork prices ended the year averaging 4.8 percent higher than 2019 at $4.03. Prices peaked in June at $4.25/pound, 8.3 percent higher compared to June 2019. December brought prices 8.1 percent higher than December 2019. Pork Chops prices averaged 11 percent above 2019 while bacon was .05 percent lower than the previous year. (Information taken from the Brownfield Weekly Livestock Market Update featuring Dr. Scott Brown, an ag. economist at the University of Missouri.)
African Swine Fever (ASF) remains a threat to worldwide pork production. China reported its first outbreak since October 26, 2020. A farm in Pingyuan county housing 1,015 head is the latest outbreak site. The Ministry of Agriculture and Rural Affairs released a statement, saying that illegal transportation was the suspected cause. Germany has found 33 more cases in wild boars, bringing their total reported cases to 544. China, South Korea and Japan all banned German pork imports in September 2020. No German cases have been found in farmed hogs. According to global pork company Genesus, Inc, 500,000 pigs were euthanized in Russia during November and December due to ASF. That represents 3 percent of the hog population there.
High yielding Choice beef breed steers and heifers at Wisconsin and surrounding state auction markets were steady bringing $97.00 to $106.00/cwt. High-yielding, high-grading cattle sold up to $107.00/cwt with a very small sampling selling higher. Choice and Prime Holstein steers were mostly steady at $87.00 to $93.00/cwt. There were reports of high-yielding, calf-fed, Holstein steers with an overnight stand bringing $94.00 to $96.00/cwt. Dairy x Beef steers were mostly $90.00 to $100.00/cwt. Cows were mostly steady at $35.00 to $53.00/cwt. Blemish free cows in fleshier condition were selling higher, while doubtful health and thin cows sold below $30.00/cwt. Dairy breed bull calves were mostly steady at $40.00 to $90.00/head with heavier, well cared for calves bringing $90.00 to $170.00. Beef and Beef Cross calves brought up to $285.00/cwt. Market lambs were lightly tested with one market reporting new crop lambs weighing 110 to 140 pounds bringing $155.00 to $220.00/cwt.