Negotiated cash fed cattle trade ended the week generally $2-$3 lower on a live basis at $122/cwt. in the Southern Plains and Nebraska; $122-$123 in the western Corn Belt. Dressed sales were $3-$4 lower at $195.
Although increasing worries about the economic impact of coronavirus weighed on equity markets Friday, Cattle futures—especially Feeder Cattle—continued to emerge from the week’s doldrums, likely helped along by short covering, month-end positioning and bullish expectations for Jan. 1 cattle numbers (see below).
Live Cattle futures closed narrowly mixed, from an average of 32¢ lower to an average of 14¢ higher.
Except for 37¢ lower in newly minted away-Jan, Feeder Cattle futures closed an average of 68¢ higher (40¢ to $1.30 higher)
Wholesale beef values were weak to lower on light to demand and offerings, according to the Agricultural Marketing Service.
Choice boxed beef cutout value was 35¢ lower Friday afternoon at $213.00/cwt. Select was 82¢ lower at $210.66.
Corn futures closed mostly fractionally higher to 1¢ higher.
Soybean futures closed mostly 2¢ to 3¢ lower.
Major U.S. financial indices dove lower Friday, fueled by growing fears about novel coronavirus and its potential impact on the global economy.
A day after the World Health Organization declared novel coronavirus a public health emergency of international concern, but made no recommendation for travel restrictions to China, major U.S. airlines suspended flights between the U.S. and China.
As well, U.S. Health and Human Services (HHS) declared the virus a public health emergency in this country.
“While this virus poses a serious public health threat, the risk to the American public remains low at this time, and we are working to keep this risk low,” according to Health and Human Services Secretary Alex M. Azar II. “We are committed to protecting the health and safety of all Americans, and this public health emergency declaration is the latest in the series of steps the Trump Administration has taken to protect our country.”
The Dow Jones Industrial Average closed 603 points lower. The S&P 500 closed 58 points lower. The NASDAQ was down 148 points.
USDA’s Cattle report issued Friday provides markets ample food for thought. There were fewer beef cows and dairy cows than pre-report estimates but more beef replacement heifers and slightly more total cattle and calves.
USDA pegs the Jan. 1 inventory of all cattle and calves at 94.41 million head, which is 0.41% less (-391,400 head) than a year earlier. Analysts surveyed by Urner Barry and reported by the Daily Livestock Report estimated a decline of 0.5% less.
Beef cows Jan. 1 were 31.31 million head, which was 1.18% less (-374,000 head) than the previous year. Analysts responding to the Urner Barry survey looked for a decline of 0.6%.
Beef replacement heifers Jan 1 of 5.77 million head were 1.92% fewer (-113,000 head) than the previous year. Ahead of the report, analysts surveyed by Urner Barry projected a 3.5% decline.
Milk cows Jan. 1 of 9.33 million head were 2.10% less (-113,000 head) than the same time a year earlier, compared to pre-report estimates of 1.2% less.
The 2019 calf crop was estimated at 36.06 million head, which was 0.70% less (-253,100 head) than in 2018
Cattle on feed Jan. 1—for all feedlots—of 14.68 million head was 2.16% more (309,800 head) than the previous year.
The estimated feeder cattle supply outside feedlots Jan. 1 of 26.45 million head is 0.40% less (-105,300 head) than a year earlier.
There were 1.61 million head grazing small grain pastures in Kansas, Oklahoma and Texas on Jan. 1. That was 15.26% less (-290,000 head) than a year earlier.
Cow Inventory Down In Most Leading Cow States
States with 1 million or more beef cows at the beginning of the year, and the ranking by size, were the same as a year earlier. In order of size, with Jan. 1 cow numbers in parenthesis: Texas (4.57 million); Oklahoma (2.09 million); Missouri (2.08 million); Nebraska (1.92 million); South Dakota (1.73 million); Kansas (1.43 million); Montana (1.43 million); Kentucky (1.01 million).
Of those eight states, beef cow numbers increased year over year in Missouri (+24,000 head or 1.17%) and Kentucky (+4,000 head or 0.39%).
For the other six states, year-over-year declines in beef cow numbers ranged from -19,000 head in Nebraska (-0.98%) to -96,000 head in Kansas (-6.28%).