Negotiated cash fed cattle trade ranged from mostly inactive on very light demand to a standstill through Monday afternoon, with too few transactions to trend, according to the Agricultural Marketing Service.
Prices on a live basis last week were $1-$2 higher in the Southern Plains at $162/cwt., $1-$2 higher in Nebraska at $159-$161 and steady to $2 higher in the western Corn Belt at $160-$162. Dressed prices were $3 higher at $257.
The weighted average five-area direct fed steer price last week was $1.55 higher on a live basis at $161.17/cwt. The weighted average steer price in the beef was $2.87 higher at $256.78.
Choice boxed beef cutout value was $1.85 higher Monday afternoon at $282.89/cwt. Select was $2.16 higher at $268.05/cwt.
CME Agriculture futures and equity markets were closed Monday in observance of President’s Day
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Tighter cattle supplies continue to drive strong auction demand.
“…cattle buyers are in fierce competition as they pull cattle from a smaller calf crop that will be even smaller this year,” says Andrew P. Griffith, agricultural economist at the University of Tennessee, in his weekly market comments. “Cow-calf producers are going to have some opportunistic decisions to make the next few years as they will be inclined to retain heifers to grow the beef herd. However, those same heifers will be highly valued in the marketplace.”
Griffith notes shorter supplies continue to tilt leverage from packers to feedlots, as evidenced by the gains the past couple of weeks.
“Cattle feeders have gained significant leverage over the packer due to a reduced number of animals coming off feed and reduced weights,” Griffith explains. “This has left packers in need of inventory to meet obligations. This may seem like unfamiliar territory to cattle feeders since it has been several years since they did hold considerable leverage. However, cattle feeders will maintain this leverage for the next couple of years as the cattle industry works to rebuild beef cow inventory. The question on most people’s mind is how quickly and to what level can cattle feeders raise prices. At the rate they are going, they have and may continue to exceed industry expectations.”