Prepared and written by Jeff Swenson, DATCP Livestock and Meat Specialist. 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.
Last week’s Cattle on Feed report showed growing feedlot inventories. Cattle in feedlots over 1,000 head totaled 11.7 million head, 2% higher than June 1 last year and 1% higher than last month. Net placement of cattle in feedlots was 10% lower than last year at 1.65 million head. The number of fed cattle marketed during May was 1.55 million head, making it the second lowest May on record. More cattle being placed than marketed during the month reflects cattle staying on feed longer. This is also confirmed by the increase in live and carcass weights. Poor packer margins and feedlot operators holding out for higher bids were the norm last week. Negotiated trade was extremely slow, making show lists larger this week. Wholesale prices were stronger last week with the Choice beef cutout averaging $395.48, making it $2.78 higher. Last year’s summer high in the cutout came during the week ending June 27, and then predictably worked lower after the July 4 holiday. If the seasonal pattern holds, there could be pressure on cattle prices throughout the rest of summer. Another sign that cattle prices could be topping is that live cattle futures are trading at a discount to cash. None of these factors change the fact that cattle supplies are tight, however. Retail demand for beef remains strong, leading some traders to forecast cattle prices at or higher than current levels through summer. Last week’s estimated harvest was 526,000 head, 2,000 fewer than the previous week and 32,000 fewer than last year. Fed steers made up 51.7% of last week’s total with heifers making up 29.9%. Cow harvest is still much lower than the five-year average and was 16.8% of the total last week. Year-to-date cattle harvest is 8.9% less than last year.
Fed cattle sold steady to strong. Top-quality beef steers and heifers brought $240-$260/cwt with some higher. Mixed Choice and Select steers and heifers ranged from $228-$240/cwt. High-grading Holstein steers were steady to strong bringing $210-$238/cwt. Lower grading steers brought $180-$210/cwt. Silage fed and under-finished steers brought $95-$180/cwt. Dairy Beef cross steers were steady to strong, bringing $210-$252 with some higher. Cows were higher, bringing $105-$151/cwt with some still selling into the $170s. Lower yielding cows brought $60-$105/cwt. Doubtful health and thin cows brought up to $60/cwt. Dairy breed bull calves were steady, selling from $800-$1,700/head. Dairy breed heifer calves brought $200-$800/head. Beef and Beef Cross calves were steady from $800 to $1,800/head. Light and lower quality calves sold up to $60. New crop lambs brought $230-$300 cwt.
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